Mitsubishi Logistics
Integrated Report2023

Corporate Philosophy
Engage in sincere and fair business activities to secure appropriate profits andpromote steady growth, appropriately compensating our stakeholders while
contributing to the realization of an affluent and sustainable society.

The Three Principles of Mitsubishi’s Business Management Philosophy
The Mitsubishi Sankoryo is a managerial creed articulated by the fourth president of the Mitsubishi organization,
Koyata Iwasaki. The Sankoryo serves as a basic philosophy of an internally and externally open group being
shared by the constituent Mitsubishi Group companies that are independent from each other.

“Shoki Hoko”“Shoji Komei”“Ritsugyo Boeki”

Corporate Responsibility
to Society

Integrity and Fairness

Global Understanding
through Business

Strive to enrich society, bothmaterially and spiritually, while
contributing toward the preservationof the global environment.

Maintain principles of transparency
and openness, conducting businesswith integrity and fairness.

Expand business, based on an
all-encompassing global perspective.

Contents■ Editorial Policy
With a particular focus on presenting the ESG Management and SDG
initiatives taken by the Mitsubishi Logistics Group, this fiscal 2023
Integrated Report includes messages from the new president and new
accounting officer, as well as a dialogue with outside directors.
Moreover, we provide updates of the History of Value Creation, At a
Glance, and Value Creation Process sections of the Report as well ascomprehensive details of initiatives aimed at resolving social issues
through business activities based on the MLC2030 Vision in an easy-tounderstand manner.
Boundary of the Report and Reporting Period

Boundary of
the Report:
Reporting
Period:The Report covers Mitsubishi Logistics Corporation (the“Company”) and Group companies.
April 1, 2022 to March 31, 2023.
(To ensure comprehensive disclosure, however, certain
relevant information regarding events that occurred prior to
and/or after this period has been included.)Introduction
Editorial Policy, Tool Map, and Contents

1

History of Value Creation

2

At a Glance4

Vision and Strategy
Top Message

6

Message from the Accounting Officer

12

Value Creation Process

16

Introduction of Businesses

18

MLC2030 Vision/Management Plan

22

Publication Date

Initiatives for Each of the Six Key Themes

September 2023
(Previous publication date: September 2022/Next planned publication
date: September 2024)

Measures to be taken, performanceindicators, and target values〈Initiatives for Each of the Six Key Themes〉

Reference Guidelines

Ministry of the Environment: Environmental Reporting
Guidelines (Fiscal 2018 Version)■	Global Reporting Initiative (GRI): Sustainability Reporting
Guidelines (GRI Standards)■	IIRC (International Integrated Reporting Council)■	Ministry of Economy, Trade and Industry: Guidance
for Collaborative Value Creation■	Contacts for Inquiries Regarding the Integrated Report

Sustainability Promotion Team, Sustainability Promotion Division,
Mitsubishi Logistics Corporation
Nihonbashi Dia Building, 19-1, Nihonbashi 1-chome, Chuo-ku,
Tokyo 103-8630, Japan
TEL: +81-3-3278-6451 FAX: +81-3-3278-6694
E-mail sustainability@mitsubishi-logistics.co.jp
Tool Map
Financial information

28

Safety, Security, Disaster Response

30

Environmental Initiatives

32

Cutting-Edge Technology, Innovation

38

Partnerships

40

Human Resource Development/Employee Satisfaction 41
Compliance, Human Rights, Gender

Providing Customer-Oriented High-ValueAdded and High-Quality Services
Quality control and improvement● Financial statement（English）● Consolidated results briefings (Japanese/English)		● Notice of Annual General Meeting of Shareholders(Japanese/English)

50

Crisis Management Countermeasures
Underpinning Safety and Security
Strengthening Risk Management andInformation Security● Flash report (Japanese)● Flash report (English)● Annual report (Japanese)

49

52

Value-Creation Infrastructure
Dialogue with Outside Directors

54

Organizational Governance (Corporate Governance) 60● Integrated Report (Japanese/English)● Business report/Interim

business report (Japanese)● Corporate Governance Report(Japanese)

Non-Financial Information

You may view various data and the reference table for Global
Reporting Initiative (GRI): Sustainability Reporting Guidelines(GRI Standards) on Mitsubishi Logistics’ Web site.

Introduction of Officers

64

Risk Management

66

Initiatives for Maintaining and Strengthening
the Compliance System
68
Initiatives for Improving Compliance Awareness/
Initiatives for Communication with Stakeholders 69

Social Contribution Activities
Contributing to Local Communities and International Society 70“Extended Version”
HOME ▶ Sustainability ▶ Integrated Report ▶ Extended version“GRI Guidelines reference table”
HOME ▶ Sustainability ▶ Integrated Report ▶
Reference table for GRI guideline

Financial Summary

74

Statement Supporting the UN Global Compact 76
Company Profile and Stock-Related Information

Mitsubishi Logistics Integrated Report 2023

77

1

History of Value Creation

External
environment

We have expanded our business domains globally to include warehousitransportation, and real estate, weaving a history of value creation by co

1920～
●

1945～

The Great Kanto Earthquake●

1960s～

World War II ends●

Expanded the Warehousing and Distribution Business
Launched the Port and Harbor Transportation Business

1970s～

Rapid economic growth●

Launched the Real Estate Business
Clarified the Company’s management policy

Oil ShockPromoted management diversification
Engaged in full-scale International Transportation Business operations

Put in place domestic business infrastructure

1907

Key Topics

1907
Wada Terminal, Kobe

Completed an integrated
land and sea cargohandling facility forshipping freight at Kobe
Port (later the Port andHarbor Transportation
Business).

Constructed a pier to smoothly link landand sea transport, and engaged in full-scaleterminal development and enhancement.

1920～

1960～

1970～

Constructed a distribution centerdedicated to specific customers.

1968

Decided to expand the Logistics Businessand enter the Real Estate Business basedon three major policies: emphasis on
profitability, transformation into acomprehensive logistics business, andefficient real estate management.

Started terminal
operator operations
for full container
vessels.

Accelerated globalization.

1973

Established the International Affairs Department(development, transport), and undertook full-scale
expansion of international integrated transport operations.

Thoroughly modernized warehousefacilities in a move away from small-scale
and inefficient operations.
1970s Mitsubishi Logistics America
Corporation, (New Jersey)

Constructed the Tokyo Dia Building.
Operated a rental building forcomputer-processing centers.

1930
Former Edobashi Warehouse Building

Met growing demand for warehouses
with earthquake- and fire-resistantfeatures.

1973～
Tokyo Dia Building

Subtopics

1887 Established as Tokyo Warehouse Limited Company,
headquartered in Fukagawa, Tokyo, after absorbing thewarehousing business from Mitsubishi Company (foundedin March 1880).
1893 Reorganized the Company and changed the name toTokyo Warehouse Co., Ltd.
1918 Changed name to Mitsubishi Warehouse Co., Ltd.
1931 Inaugurated Japan’s first trunk-room service in Edobashi(present-day Nihonbashi), Tokyo.

1962 Constructed a multi-purpose rental building for data
centers, warehousing rooms and residential units inFukagawa, Tokyo.

1970 Established a warehousing company in California, U.S.
1971 Began terminal operator operations for full container
vessels at Port Island in Kobe.
Made a full-scale entry into the air freight business.
1981 Subcontracted operations at Daikoku Pier in Yokohama.
1984 Established a transportation company in Singapore.
1986 Subcontracted operations at Oi Pier in Tokyo.

Fiscal 1990 (non-consolidated)
Operating revenue: ¥112,499 million
Operating income: ¥9,037 million¥5,693 million
Net income:

Operating revenue*1 Fiscal 1945-1986 data prepared from Company history*2 The Company shifted to a one-year accounting period from the 173rd fiscal year following the revision of the Commercial
Code of Japan in 1974. Prior to that, figures are the sum of two fiscal periods.
*3 Consolidated figures since fiscal 1999 (fiscal year ended March 31, 2000), when disclosure of consolidated financial
statements became mandatory.
Fiscal 1960 (non-consolidated)
Operating revenue: ¥5,176 million
Operating income: ¥428 million¥319 million
Net income:

Fiscal 1970 (non-consolidated)
Operating revenue:¥19,413 million
Operating income: ¥1,678 million¥1,678 million
Net income:
*2*11945 1950

2

Mitsubishi Logistics Integrated Report 2023

1955

1960

1965

1970

1975

1980

1985

ing and distribution, port and harbor transportation, international
ontributing to society and our customers.
Warehousing and Distribution Business/
Overland Transportation Business1990s～

Collapse of Japan’s bubble economy● Great Hanshin Awaji Earthquake● Lehman Shock●Port and Harbor
Transportation Business

International
Transportation Business

Real EstateBusiness

Others

2010s～●The Great East Japan Earthquake

Strengthened comprehensive logistics services
Shifted to High value-added and high quality of services●

Adoption of the Paris Agreement●

COVID-19

Strengthened solution services

Expanded global network

1992

Built high-performance warehouses at eachbranch (approximately 83,000 m2) and declared
the first year of our warehouse remodeling.

2010

2011
1990s
Chuo Futo Warehouse in Fukuoka

1996

*3

1998 Realigned overseas organizations.
1999 Made a full-scale entry into the refrigerated warehouse business.
2001 Undertook seismic isolation work at buildings 1-4 at Tokyo Dia
Building.
Began operations at the Minamihonmoku Pier Terminal in
Yokohama.

1990

1995

2000

2005

2017 Disaster-Resistant and Eco-Friendly Warehouse
Completed theMM2100Distribution Centerin Indonesia as the first overseas DisasterResistant and Eco-Friendly Warehouse.

2021
Opened “SharE Center misato” in Misato
City, Saitama Prefecture.

Disaster-Resistant and Eco-Friendly Warehouse

Completed Ibaraki Distribution Center No.
3 in Osaka, the first Disaster-Resistantand Eco-Friendly Warehouse.
Constructed other Disaster-Resistant and
Eco-Friendly Warehouses in several
domestic areas since then.

2006
Opened Yokohama Bay
Quarter in Kanagawa.

Fiscal 1999 (consolidated)
Operating revenue:¥153,178 million
Operating income: ¥11,200 million¥5,815 million
Net income:

Completed Nihonbashi Dia Building.
Rebuilt the warehousebuilding (head office, trunkroom) owned in Edobashi,Tokyo, and constructed a
Disaster-Resistant and
Eco-Friendly Office Building.

Won first place inthe world forcontainer terminal
cargo handlingefficiency at the Minamihonmoku
Distribution Center in Yokohama.

Upgraded Kobe Harbor Landrental commercial facilities.

Fiscal 1992 (non-consolidated)
Operating revenue:¥124,440 million
Operating income: ¥10,788 million¥7,160 million
Net income:

Turned Fuji Logistics Co., Ltd. and its 10
subsidiaries into our consolidated subsidiaries
in order to enhance 3PL and services in theelectric, electronics, precision equipment, andsemiconductor fields.

2012

2007

1992 Constructed rental facilities, including retail facilities and officebuildings, at Harborland, Kobe.
Began operations at Daikoku C-3 Container Terminal in Yokohama.
1993 Established Mitsubishi Logistics Indonesia.
1995 Established a transportation company in the Netherlands.
1996 Established Shanghai Linghua Logistics Co., Ltd.

2014 Disaster-Resistant and Eco-Friendly Office Building

Established DP-Cool and roomtemperature GDP transportation* provided
by Dia Pharmaceutical Network Co., Ltd.
Began developing temperature-controlled
pharmaceuticals delivery service.

1990s
Oi Sales Office in Tokyo

Changed English name to Mitsubishi Logistics
Corporation in a bid to provide comprehensive
logistics services.
Proactively expanded
pharmaceuticals handlingand put in place
pharmaceuticals logistics
1996 Tokyo Branch
infrastructure.
Yashio Sales Office
Expanded container terminal Yashio Distribution Center
operations.

Participated in public-private partnerships (PPP).

2022

2011 Established MLC ITL Logistics Company Limited in Vietnam.
2012 Established Mitsubishi Logistics China Co., Ltd.
Acquired Shanghai Qingke Warehouse Management Co., Ltd.
through the aforementioned.
Fiscal 2010 (consolidated)
Operating revenue: ¥175,879 million
Operating income: ¥12,164 million¥6,973 million
Net income:

Commenced ML
Chain operations.

Fiscal 2022 (consolidated)
Operating revenue: ¥300,594 million
Operating income: ¥23,027 million¥27,226 million
Net income:

Fiscal 2020 (consolidated)
Operating revenue: ¥213,729 million
Operating income: ¥11,735 million¥39,160 million
Net income:

2013 Opened Kobe Harbor Land umie.
Started leasing the Osaka Nanko C-9 Container Terminal.
Established P.T. Dia-Jaya Forwarding Indonesia.
2014 Leased Mitsubishi Logistics America Corporation warehouses in Los Angeles.
2019 Completed Seishin Distribution Center Phase 2 Building in Kobe.
2021	Formed a partnership with Cryoport, Inc. (U.S) for regenerative medicine supply chain.
Formed business alliance with OnAsset Intelligence, Inc. (U.S.) (visualization solution for international transportation).
2022 Formed capital and business alliances with K.R.S. Corporation, Cryoport, Inc. and others.
Formed a capital and business alliance with Rapyuta Robotics Co., Ltd.

2010

2015

2020
Mitsubishi Logistics Integrated Report 2023

(FY)

3

At a Glance*As of March 31, 2023

Financial Items

Operating revenue

¥

300.5

Operating income

billion¥23.0

billionValue-creation Infrastructure
Network

Number of Mitsubishi Logistics Group companies

67

Number of logistics bases worldwide

companies

Total

bases

(Subsidiary Companies 52 companies/Affiliated Companies 15 companies)(Japan 90 bases/Major overseas cities 50 bases)

Warehouse area

Real estate floor area

Approximately

1.17

million m2

Approximately

Human resources who are the source of value creation

4

140

Mitsubishi Logistics Integrated Report 2023

1

million m2

Overseas sales ratio

ROE (return on equity)

21.5

7.8

%

%

ESG

Cumulative number of DisasterResistant Eco-Friendly Warehouses

11

facilities

CO2 emissions per revenue

0.184

t-CO2 /million yen(Floor area approximately 0.33 million m2)-19.8% (versus FY2021)
CO2 emissions -6.4% (versus FY2021)

Ratio of new employees
retained after three years

Number of male employees using
general care leave system

92.2

%

(New graduates who joined the Company on
April 1, 2020 and remained in the Company’s
employment as of April 1, 2023)

43%

Number of employees(Consolidated)

4,708
Number of people who received
compliance education

9,297(Number of people who received
compliance education Group-wide)

Mitsubishi Logistics Integrated Report 2023

5

Top Message

The Mitsubishi Logistics Group focuses on global
environment-friendly activities and engages in sincere
and fair business activities, contributing to the realizationof an affluent and sustainable society.

Hidechika Saito
Representative Director
and President

The MLC2030 Vision

Contributing to the improvement of customer value, we offer comprehensive logistics solutions to the
management of customers’ supply chains, from procurement to distribution/sales, as their partner.

6

Mitsubishi Logistics Integrated Report 2023

Accelerating Our Transformation as We Advance to the Next Stage
Introduction
Now in the position to oversee all of the Company’sbusiness operations since assuming the office ofrepresentative director and president in April 2023,
my views are completely different from before myappointment. Once again, I feel the weight of ultimate
responsibility for the Company.

Mitsubishi Logistics celebrates its 137th
anniversary this year. While cherishing the wealth ofassets we have accumulated over our long history,
including the experience and relationships of trustwith our customers, we have undertaken a
succession of changes in response to the times.
However, in this era of dramatic changes in theexternal environment, we recognize the need to ramp
up and accelerate our transformation endeavors.

What We Hope to Convey
Thoughts on the MLC2030 Vision

What Comes from Diverse Human Resources

The Mitsubishi Logistics Group has contributed to thecreation of an affluent and sustainable society throughits Logistics Business with a focus on warehousing
and its Real Estate Business. Going forward, theGroup put in place its MLC2030 Vision in 2019 toensure that we continue to engage in customeroriented operations and become an innovator in
future society.
This vision was born from management’s sense ofcrisis that the Group was not adequately responding
to the drastic changes in the business andmanagement environment in which it had been
operating well prior to its announcement. The
MLC2030 Vision lays out the course to be taken as
the entire Group embarks on a powerfultransformation. My primary mission is to accelerate
this transformation process and bring the MLC2030
Vision to fruition.

Diverse human resources are essential to driving
change and creating innovation. The combination ofdiverse people with disparate perspectives and ideas
provides the seeds for innovation.
With this in mind, we recognize the need to create
an environment in which women can play an evenmore active role and men can more easily take childcare leave.
While posted to Shanghai, China from 2012 to2018, I saw first-hand the efforts of local staff toproactively put forward proposals in response tovarious requests from Chinese customers. These
endeavors were greatly appreciated by customers
and contributed to improved business performance.
Without the energy and vitality of local staff, it is highly
unlikely that the Company would have been able toaddress the needs of our Chinese customers or
ascertain the services they demand.
I firmly believe that innovation is the driving force
behind the Company’s sustainable growth. To thisend, it is critical that we foster an organizational
culture that respects the broad values created bydiverse human resources and allows each individual
to maximize his or her individuality and abilities.

Lessons from the COVID-19 Pandemic
The Group has overcome a host of difficulties over its
long history. As a company that supports criticalsocial infrastructure in the form of logistics, while
fulfilling an essential function, we have worked
diligently to support our customers’ businesses andpeople’s lives, particularly throughout the COVID-19
pandemic. In light of this proven track record, I am
confident that society has once again recognized theimportance of logistics and highly values our services.
In overcoming the pandemic, we have also
reaffirmed the critical need to maintain and develop
our business together with employees while
confronting head-on social issues irrespective ofchanges in the external environment.

Mitsubishi Logistics Integrated Report 2023

7

Top Message
Progress on the MLC2030 Vision

8

Second Stage Management Plan

The Medical/Health Care and Food/(2022-2024) Off to a Steady Start

Beverage Fields

The Group’s medium- to long-term vision is to offer
comprehensive logistics solutions to the managementof customers’ supply chains, from procurement to
distribution and sales, as their partner by focusing
primarily on contributing to the improvement ofcustomer value. The MLC2030 Vision is thecornerstone of our management strategy to achieve
this goal.
Under this vision, we put in place a three-year plan,
starting in 2019, as a first stage to lay the foundation.
Over this period, we steadily implemented key
measures set forth in the management plan, including
the opening of a distribution center for e-commerce,
which is expected to grow significantly in the future,and the strengthening of our food and pharmaceuticaltransportation system through partnerships.
In the second stage, we have been focusing on
efforts to improve business profitability, expand
overseas business, and develop high-value-added
services using cutting-edge technologies since fiscal
2022. Looking back on the Group’s performanceover the first year, operating income increased 26.9%
compared with the previous fiscal year due to thefavorable external environment, including trends inforeign currency exchange rates and higher unit
freight rates for international transportation. We areseeing the effects of measures to improve profitability,
mainly in the Logistics Business, steadily materialize.

We are placing the highest priority on the medical andhealth care sectors. The Group commenced
pharmaceutical distribution center operations during
the 1980s. In addition to establishing Dia
Pharmaceutical Network Co., Ltd. as a specialized
transportation company to further strengthen ourpharmaceutical distribution center business, webolstered efforts to transport pharmaceuticals safely
and securely through various measures, including thelaunch of DP-Cool, a delivery service that complies
with Good Distribution Practice (GDP) guidelines forpharmaceuticals. Moreover, based on the know-how
cultivated through DP-Cool, we have developed
DP-Green, a GDP-compliant delivery service forroom-temperature pharmaceuticals, which we beganoffering in 2022.
Over and above the aforementioned, the Group isstrengthening the development of logistics services
targeting regenerative medicine andbiopharmaceuticals, which require ultra-lowtemperature storage. We will enhance quality in the
medical and health care domains, and at the sametime, vigorously take on the challenge of entering theadvanced medical field, which is expected to grow.
Meanwhile, in similar fashion to the pharmaceuticalsector, food and beverages fall within the daily
necessities field. As such, this is an area in which theGroup can greatly demonstrate its strengths in terms

Mitsubishi Logistics Integrated Report 2023

of safety and security. The Group has continued toindependently expand the distribution of food andbeverages in Japan, using refrigerated warehouses invarious locations as bases while initiating businessalliances with operators with strengths intransportation. As a result, the synergy between
these two endeavors will dramatically strengthen andexpand the cold chain network, and is expected tomake a significant contribution to the Group’s
profitability.

The Machinery/Electrical Machine and
New Materials Fields
In the machinery and electronics field, we aim to growour automotive-related Logistics Business. CASE has
become a representative trend in the automotive
industry in recent years. Against the backdrop ofcontinued technological innovation and growing
efforts to reduce environmental impact worldwide,
the automotive industry is undergoing a period of
structural transformation and the supply chain isexperiencing major changes. Under thesecircumstances, the development and sales of EVs is
expanding significantly.
In January 2023, Mitsubishi Logistics concluded abusiness outsourcing contract with the Japanesesubsidiary of an overseas EV manufacturer for thelogistics function of finished vehicles and parts. As apart of this initiative, we opened the Pre-DeliveryInspection (PDI) Center at Daikoku Pier at the Port of
Yokohama. In the passenger car business developedby overseas EV manufacturers in Japan, we engage
in the full gamut of activities from vehicle arrival at theport of entry to maintenance, domestictransportation, storage of aftermarket parts, andnationwide delivery.
Since receiving this order for outsourcing services
from an overseas EV manufacturer, inquiries related
to EV logistics have increased. Moving forward, we
will continue to accumulate know-how to address thedemand for logistics services by the automotive
industry in the new era, both here in Japan andoverseas.
In the areas of new sustainable materials, we areworking to expand our business by providing
comprehensive logistics services, focusing onmaterials where growth is expected, including highperformance composite materials and materials for
manufacturing semiconductor devices.

Expanding Overseas Business
The downturn in Japan’s population attributable to its
declining birthrate and aging population is expected

to negatively impact the volume of logistics handledover the medium to long term. In light of this trend in
its operating environment the Mitsubishi Logistics
Group has adopted a Global Grid Strategy in a bid to
expand its overseas business. Guided by thisstrategy, we are building a structure and systems that
can help optimize customers’ global supply chains.
We have identified the medical/health care andfood/beverage fields as priority areas in our overseas
business and are vigorously expanding partnerships
to strengthen our structure. In the medical/health carefield, plans are in place to acquire an equity interest in
the Cavalier Logistics Group, a company based in the
U.S. that has established an advanced supply chain
for biopharmaceutical logistics mainly in the UnitedStates and the United Kingdom. Mitsubishi Logistics
has fostered a long-standing and successful
partnership with the company, and participation in thegroup through the acquisition of shares will enable us
to provide services that take advantage of significant
global scale.
The ASEAN region is also a target of our overseas
expansion aspirations. We are also looking to growour business throughout the Indochina Peninsula. To
this end, we will partner with In Do Trans Logistics
Corporation, a company that engages mainly in cold
chain logistics. In specific terms, we will strengthen
sales capabilities while combining the know-how andcustomer bases of both companies.
The key to cold chain success in ASEAN countries
is aggressive investment, including the developmentof logistics infrastructure. Notwithstanding
improvements in living standards in ASEAN countries,
which continue to enjoy remarkable economic
growth, the development of low-temperature logistics
infrastructure lags in comparison. Encouraged by theJapanese government, Japanese logistics companies
are currently engaged in the export of Japanese-style
cold chain system. With the need to address a variety
of social issues, including food safety and the
reduction of food loss, very much in mind, theMitsubishi Logistics Group will contribute to improving
customers’ supply chains.

Port and Harbor Transportation BusinessIn the Port and Harbor Transportation Business, wewill work to further improve the quality of service to
our customers’ shipping companies and solve
problems that we have not been able to handle in thepast. At the same time, we will improve profitability bypromoting efficiency.
We are confident that our high-quality port andharbor transportation services have been wellreceived by customers. This reflects the Group’s

Mitsubishi Logistics Integrated Report 2023

9

Top Message
long-standing track record in container terminal
operations and efforts to improve cargo handlingefficiency. Looking ahead, we will continue to improve
service and work efficiency and strengthen ourcustomer base.

Real Estate BusinessIn the Real Estate Business, we are focusing on realestate development that does not depend on landownership, a longstanding unresolved issue. Most
recently, there has been a certain amount of progressin the Kobe Sannomiya redevelopment project as wellas the redevelopment of Suma Aqualife Park andSeaside Park. While these two projects also utilize
partnerships with real estate companies, we willcontinue to accumulate know-how to strengthen ourdeveloper function.
As far as real estate development is concerned, weare promoting the supply of Disaster-Resistant and
Eco-Friendly Office Buildings. The Group has
experienced major damage to its business
infrastructure due to past large-scale disasters,
including the Great Kanto and Great Hanshin Awaji
earthquakes, the lessons of which are deeply
ingrained. Against the backdrop of frequent localized
natural disasters in addition to earthquakes, we will
enhance the safety and security of our stakeholders
by promoting resilient development while leveraging
our experiences with disasters gained in the past.

Accelerating DX
Mitsubishi Logistics is promoting the development ofhigh value-added services by utilizing cutting-edge
technology in its efforts to realize the MLC2030
Vision. In addition to existing customers, we areworking with external partners through investments inventure capitals (VCs), including the BizTech Fund,and direct investments in startups to strengthen
development capabilities and create innovation. To
further promote this initiative, we have established a
CVC of ¥5 billion. Our goal is to cultivate new
businesses in the logistics, real estate, and peripheral
areas by working more closely with startups throughthe CVC.
To improve efficiency and sophistication of logistics
operations and facility management, we are
introducing optimal digital technology (including
AGVs, automated forklifts, and shelf-transport robots)at logistics sites, using robots to improve work
efficiency and optimize the number of personnel, andfine-tuning the allocation of cargo and personnel
through the use of AI. In e-commerce logistics
operations, we opened “SharE Center misato,” a
distribution center for e-commerce in 2021. This
Center is equipped with automated delivery robots
and a warehouse management system (WMS) thatspecializes in e-commerce logistics. Located in
Misato City, Saitama Prefecture, in the suburbs ofcentral Tokyo, the largest consumption area in Japan,
this Center will support the distribution of a wide
variety of products.
In our efforts to develop logistics platform services,“ML Chain” commenced operations from 2022. ML
Chain is designed to help visualize pharmaceuticallogistics across the entire supply chain in real time,
thereby achieving a higher level of quality control. By
providing value-added services that surpass anything
the Group has offered to date, we are endeavoring toachieve a high level of quality control and sustainablelogistics.

Human Capital Management Initiatives
The Need for Organizational Culture Reform
Looking back on our history, we have continued tostand at the forefront of the industry, taking on new
challenges ahead of our peers. For example, we were
one of the first warehousing companies to engage inthe redevelopment of real estate redevelopment andinternational transportation. We have also developed
trunk room services to store household goods andartwork.
Having said this, the pioneering spirit of ourpredecessors has seemingly waned as a defensive
posture has crept increasingly into our corporate

10

Mitsubishi Logistics Integrated Report 2023

culture. If we continue to follow precedents, we run
the risk of becoming stagnant. With this in mind, I
recognize the critical need to take the initiative if weare to address the rapidly changing needs of society
and customers. My goal is to create an organizational
climate in which employees can freely express theiropinions, think on their own, and work independently.

Promoting Human Capital Management
One of the directions the Group should take is toprovide high value-added logistics services. To thisend, human resources are a wellspring for creatingnew services and value for customers. I believe that
education is extremely important in the developmentof those human resources who will be responsible foreach business division, promote M&As, and will form
the next generation of leaders in their respective
fields.
For this reason, we will establish an in-houseacademy as a conduit through which to systematize
and provide essential education in cooperation withexternal specialized institutions.
We have also initiated steps to hold town hallmeetings and conduct engagement surveys to help
employees better understand the Company’s thinking
thereby serving as motivation tools. Historically, theCompany’s operations have largely been conductedbased on dialogue between senior executives andmanagers. Recently, Mitsubishi Logistics has placed
greater emphasis on soliciting the opinions of younger
employees and encouraging two-way communication
as it pushes forward the Company’s operations witha greater sense of urgency.
Moreover, Mitsubishi Logistics is working to build
a human resources portfolio. We are preparing totake all necessary measures by analyzing the quality
and quantity of human resources. In this manner, we
will determine what kind of human resources are
required to achieve the MLC2030 Vision andManagement Plan.

Formulating Our Purpose
Although the Group boasts a long history, it has notalways clearly articulated the significance of its
existence. Nevertheless, we will expand the scope ofour business on an ongoing basis against the
backdrop of a social environment which continued todramatically change.

The Three Principles of Mitsubishi’s Business
Management Philosophy (“Sankoryo”), namely
Corporate Responsibility to Society, Integrity and
Fairness, and Global Understanding through Businessare concepts shared by all Mitsubishi Group
companies. Together with these Principles, Mitsubishi
Logistics is now in the process of once again
clarifying its purpose and clearly articulating theGroup’s raison d’être and sense of value to its
stakeholders. While these efforts remain a work-inprogress, we plan to hold detailed discussions toensure that our purpose is well understood, and thento announce details publicly.

In Closing
The Mitsubishi Logistics Group is accelerating its
transformation endeavors. However, we will continue
to hold on to our founding sense of mission as acompany that engages in essential work, as well as
the values of responsibility and integrity that support
it, as principles that must not be changed and will
never change.
Looking at issues in 2024, including geopoliticalrisks and climate change, the environment in which
the Group operates is changing dramatically. In orderto realize a sustainable society into the future, I am
convinced that the Group must support thefoundations of society. With a strong sense of
mission, we will build on our proven track record andwork in unison toward the next stage.
As we work toward achieving our goals, we ask
for your continued support and understanding.

Mitsubishi Logistics Integrated Report 2023

11

Message from the Accounting Officer

We are committed to improving capitalefficiency and profitability to further enhance
corporate value.

Akira Yamao
Director and Managing Executive Officer

12

Mitsubishi Logistics Integrated Report 2023

Results and Other Information for Fiscal 2022
Mitsubishi Logistics has identified three numerical targets over its second stage (2022-2024) of efforts
to realize its MLC2030 Vision.
Numerical
Targets

Operating income

ROE

DOE

¥20.0 billion (FY2024)

7% (FY2024)

continuously 2% or above

In fiscal 2022, the first fiscal year of this second stage, operating revenue increased 16.9% comparedwith the previous fiscal year, to ¥300.5 billion. From a profit perspective, operating income climbed
26.9% year on year, to ¥23.0 billion. Each result represented a record high. This improved performance
was largely due to the upswing in marine freight transportation rates in the Group’s International
Transportation Business coupled with significant depreciation in the value of the yen across foreign
currency exchange markets as well as a recovery in the movement of cargo and successful efforts to
reduce costs.
Moreover, ordinary income grew 29.8% to ¥30.0 billion owing to an increase in dividends received
from shares held. Meanwhile, profit attributable to owners of parent increased significantly to ¥27.2
billion yen as a result of the sale of cross-shareholdings. Buoyed by the improvement in profitability,
ROE came in at 7.8%, exceeding the final fiscal year target under the current Management Plan. Basedon the aforementioned, the Company has decided to pay an annual dividend of ¥90 per share.
Our free cash flow was ¥26.1 billion, an increase of ¥19.1 billion compared with the previous fiscal
year. Under our Management Plan, we are aggressively investing in businesses to maintain ourcompetitiveness and in strategic investments to create new businesses. In this regard, we are confident
that our ability to generate cash to fund these investments is steadily increasing.

Financial Strategy and Capital Policy
Mitsubishi Logistics has identified five basic policies under its three-year Management Plan currently
underway.
■ Strengthen the profitability of the Logistics Business
1
2 Expand the foundations for the growth of overseas business■
3 Expand the Real Estate Business by strengthening development capabilities■
4 Develop high value-added services by utilizing cutting-edge technology■
5 Strengthen the Group management base■To support these policies, we will work to enhance corporate value through growth investments while
continuing to generate stable cash flows from operating activities, which we recognize is the source ofgrowth from a financial perspective, and actively promote shareholder returns, including the buyback oftreasury shares. In this context, we will strive to improve ROE and stabilize the payout ratio, while
securing continuous dividends with a DOE of 2% or above.

❶ Generating cash
We plan to generate ¥100 billion in cash flow from operating activities over the period of 2022 to 2024.
From a balance sheet management perspective, we plan to generate ¥180 billion in cash over thethree-year period by generating ¥40 billion from both the review of cross-shareholdings and theutilization of other avenues including external borrowings, respectively.

Mitsubishi Logistics Integrated Report 2023

13

Message from the Accounting Officer❷ Improving capital efficiency
We have set ROE as a financial KPI under the current Management Plan, and are working to improve
profitability and optimize capital adequacy. Although ROE increased significantly in the current fiscal
year due to the external environment, the Company’s capital efficiency has historically been low with
ROE lingering below 4%. This reflects our inability to translate a strong equity capital into growth, and alack of awareness toward capital efficiency and shareholder returns.
As far as the current Management Plan is concerned, we are promoting measures to improve profit
margins over the medium to long term through a variety of means, including reducing crossshareholdings while utilizing borrowings, strengthening business profitability, and expanding our growthbase with an eye on overseas markets. As a result, we have seen an improvement in ROE, mainly
through an increase in the net profit margin, and have been able to exceed the final target of 7% in thefirst fiscal year of the current Management Plan.

❸ Reviewing assets held
Mitsubishi Logistics is accelerating the reduction of cross-shareholdings based on an ongoing review of
the rationale underpinning shares held. Under the previous Management Plan, we sold a cumulative
total of ¥20 billion, and under the current Plan, aim to double this amount to ¥40 billion. We willcontinue to pursue reduction endeavors, and plan to cutback the ratio of cross-shareholdings to lessthan 20% by the end of fiscal 2025. We intend to allocate the cash generated from the sale of crossshareholdings to strategic investments and shareholder returns, including the buyback of treasury
shares. Meanwhile, we will clarify the strategic significance of continuing to hold shares and verify the
return on such holdings from a cost of capital perspective. Based on the aforementioned, we will only
hold shares when the Board of Directors deems it reasonable to do so.
In addition to these initiatives, we are promoting the sale of non-core assets in the Real EstateBusiness. Most recently, we sold non-core retail facilities in the Tokyo and Osaka areas. Proceeds fromthe sale will be used for investments aimed at growth.
Trends in the amount of cross-shareholding sales
Total ¥40.0 billion
or more(Unit: ¥billion)
16.0
14.0

Trends in the amount of cross-shareholdings held and ratio to net assets(Unit: ¥billion) ■ Amount held
150.0

33.4

Ratio of cross-shareholdings (%)
40
to net assets

12.0

12.0

30
100.0

10.0
8.0

6.0

6.0

6.8

Less than 20%

7.6

20
50.0

118.2
10

4.0
2.0

1.3
0

0
2018

2019

2020

(FY)

14

Mitsubishi Logistics Integrated Report 2023

2021

Management Plan
(2022-2024)

0March 31,2023

March 31,2024

March 31,2025

March 31,2026

❹ Capital allocation(1) Investment plan: Ensuring financial soundness
Under the current Management Plan, we plan to invest ¥40 billion in the Logistics and Real EstateBusinesses to maintain and strengthen the competitiveness of existing businesses. We will also
undertake ¥50 billion in strategic investments in such areas as DX, new business development, andM&A. While engaging in aggressive investments, we will maintain a disciplined approach towardfinancing. Our equity ratio has continuously exceeded 60% against the medium- to long-term target of
55%. We intend to promote growth investments while keeping in mind our credit ratings (JCR: AA, R&I:
A+).
(2) Shareholder returns policy
Mitsubishi Logistics’ policy is to pay stable and continuous dividends with a DOE of 2% or above. We
will return profits to shareholders by enhancing corporate value through aggressive growth investments
and efforts to improve profitability. At the same time, we will implement the flexible buyback of treasury
shares. We acquired a total of ¥20 billion over the three-year period of the previous Management Plan,and plan to acquire more than ¥30 billion under the current Management Plan.

FY2019-2021 Cumulative cash flowIN

FY2022-2024 plan Cumulative cash flow

OUT
Sale of shares,
etc.

Sale of shares,
etc.
External borrowings, etc.

¥20.0 billion¥15.0 billion

Logistics¥40.0 billion
Real estate¥65.0 billion

Operating CF
and others

External
borrowings, etc.

OUT

¥40.0 billion

Logistics¥40.0 billion¥40.0 billion

Real estate¥40.0 billion

Business
investments

Investments
Operating CF
and others¥106.0 billion*¥36.0 billionIN

Shareholder
returns¥50.0 billion

Strategic
investments¥50.0 billion

Shareholder
returns¥100.0 billion* Operating CF and others for FY2019-2021 includes approximately ¥36.6 billion in compensation income, etc. received from the sale of land in front of Nagoya
Station.

To Our Stakeholders
We believe that improving capital efficiency and profitability is essential to enhance corporate value overthe medium to long term. In light of the increasing importance of non-financial information, including theaddition of sustainability and human capital management to the content of securities reports, we will
work to provide fair, timely, and appropriate management information and aim to enhance corporate
value through constructive dialogue with our stakeholders.

Mitsubishi Logistics Integrated Report 2023

15

Value Creation Process

InputsSocial & Relationship CapitalBusiness Model

P2⃝ Trust gained through more than

130 years of history⃝ Excellent customer base built

on that trust

Human Capital

P 41

io
n

⃝ Consolidated number of employees: 4,708

ct⃝ Diverse, customer-focused human resourcesA⃝ Human resource development that

contributes to added value creation

AcIntellectual Capital P2, 18, 50

cu

mu

on
la t io f ex p e

r t i se and kn

ow-

how

⃝ Mitsubishi Logistics Improvement Procedures⃝ Accumulated skills and know-how in warehousing

and distribution, port and harbor transportation as
well as international transportation⃝ Unique know-how in real estate development⃝ Customer insights

On-site capabilities
that realize products
best suited to clients’ needs

Human Resources Who Are the Source of Value Creation

Customer-oriented,
high added-value andhigh-quality service
provision

The three values passed down to ourhuman resources
Honesty

Originality andIngenuity
P 2, 18

dv⃝ Business foundations located closeefrodue to multiple warehouses

P12, 74Natural Capital

s

P 32

⃝ Energy usage: 594,595 GJ⃝ Electricity consumption:



ion

k
ec

⃝ Operating CF: ¥40,488 million

lut

Ch

⃝ Equity ratio: 61.1%

som⃝ Extensive international transportation network⃝ Total assets: ¥573,689 million

Ability toascertain
needs

alu

to metropolitan areas⃝ Broad-based transportation network

Financial CapitalServicedevelopment
capabilities

dde

Manufacturing CapitalHigh aCustomerFirst

127,749 MWh

DX-based productivity
improvements

P 38

Taking on challengesof new fields

P 38, 40

Crisis management measures that underpin safety and security
Corporate governanceCorporate philosophy and Code of Conduct based on the spirit of theThree Principles of Mitsubishi’s Business Management Philosophy

16

Mitsubishi Logistics Integrated Report 2023

Open innovatio
by means of C
P 52

P 60

Inside back cover, P 47

Outputs and Value Creation

Realization of Vision

VisionEconomic Value

300,594 million⃝ Operating income:  ¥23,027 million⃝ ROE: 
7.8%

MLC2030 Vision P 22

⃝ Operating revenue: ¥

an
Pl

P 18

[ Warehousing and Distribution Business ]Contributing to the improvement ofcustomer value, we offer
comprehensive logistics solutions to
the management of customers’
supply chains, from procurement to
distribution/sales, as their partner.

Im p ro ve m ent/ u p g r a d i n g o f o p e

r a t ions

● Domestic/overseas logistics● Import shipping agent business[ Port and Harbor Transportation Business ]● Container terminal business● Conventional shipping business[ International Transportation Business ]● Ocean/air transportation● Large/heavy cargo transportation● Export shipping agent business/customs clearance● SCM consulting

buildings, retail facilities, hotels, and residences

Do

P 28

to be tackled by the Group
Safety, security,
disaster response

P 30

Environmental initiatives

P 32

Cutting-edge technology,
innovation

P 38

Partnerships

P 40

Human resource development,
employee satisfaction

P 41

Compliance,
human rights, gender

P 49[ Real Estate Business ]● Real estate development, including office

P 38, 40
on
CVC, M&A

Six key themes

Social Value⃝ Realization of highly safety-enhanced

logistics and real estate⃝ Reducing environmental impact and protecting

human rights in entire supply chains⃝ Improvement in engagement

P 43

Mitsubishi Logistics Integrated Report 2023

17

Introduction of Businesses

Utilizing the skills and know-how cultivated overour 137-year history, we support people’s affluent
lives and our customers’ corporate activities.
Protecting our customers’ supply chains through logistics with high safety and quality,
providing comprehensive solution services that meet diversifying individual needs.
Warehousing and Distribution Business/Overland Transportation Business
The Group’s Warehousing and Distribution Business and Overland Transportation Business provide a variety oflogistics services, including storage and transportation, for a wide variety of raw materials and products, suchas food/beverage, pharmaceutical and healthcare supplies, and machinery and electrical equipment, including
automotive components. Furthermore, by promoting investments (logistics DX investments) aimed at
improving the efficiency of entire supply chains, such as Disaster-Resistant Eco-Friendly Warehouses,
strengthening relationships with domestic and overseas partners, and building the ML Chain pharmaceuticallogistics data platform, we are working to solve a range of issues in domestic logistics, such as the 2024
issue, and to help everyone realize affluent lives.

Port and Harbor Transportation Business

International Transportation BusinessWe provide secure high-quality logistics services, including
container terminal operations, for integrated port and harbortransportation at all major Japanese ports, namely Tokyo,
Yokohama, Nagoya, Osaka, Kobe and Hakata. We also offer a wide
range of other marine shipping-related services, such as importing/exporting of vessels, ship registration, and agency operations for
special ships such as oil-drilling rigs.

In response to increasingly diversifying customers’ logistics needs,
we propose optimum transportation routes door-to-door worldwide
tailored to every customer’s request by taking advantage of ourglobal network and a variety of transportation means, such as
vessels, aircraft, railways and trucks. Meanwhile, the Group’s
overseas operating bases provide comprehensive logistics services,such as cargo transportation, customs clearance and the storageof goods as well as logistics-related
support services, such as consulting
on legal systems, procedures andtariff costs utilizing economic
partnership agreements in therespective areas for customers whoplan to launch into foreign markets.

Logistics Business

87.4%

263,899 million

Operating ¥revenue

Operatingrevenuecompared withfiscal 2022

Real Estate Business

12.6%

38,199 million

Operatingrevenue   ¥Contributing to the realization of an affluent and sustainable society through the development of real estate facilities.
We are involved in the Real Estate Business in all six major cities of Japan—Tokyo,
Yokohama, Nagoya, Osaka, Kobe and Fukuoka. In addition to activities such as theredevelopment of properties based on the optimum application of each property’s
features and the leasing of approximately 50 real estate facilities (offices, retailfacilities and residences), totaling almost 1 million m2 of total floor space, we are
involved in the sales of condominiums.
We are also active in developing Disaster-Resistant and Eco-Friendly Office
Buildings, which meet business continuity needs and reduce environmental burden.

18

Mitsubishi Logistics Integrated Report 2023

Logistics
Business

Warehousing and Distribution Business, Overland Transportation Business
By providing high-quality logistics services that safely and securely deliver daily
necessities such as foods/beverages and pharmaceuticals to everyone, we promote theconcentration of our management resources on areas that contribute to the realization ofa sustainable society, including the building of the supply chains for next-generation
vehicles, as typified by EVs, of which a significant role is being expected in the process ofmaking society carbon neutral.
Also, by continuing to develop services that provide new added value for entire supply
chains, such as logistics DX investment to improve productivity and the ML Chain
pharmaceutical logistics data platform, we will achieve growth in both businesses.
Segment overview

Takero Shimizu
General Manager,
Warehousing and Distribution
Business Division

Warehousing and Distribution Business

Operating revenue (Unit: ¥billion)

Revenue increased due to new operations at
the Ibaraki Distribution Center No. 5 in Osakaand EV distribution center operations.

55.954 58.562

63.980Fiscal 2022 operating revenue¥

63,980 million (up 9.3% year on year

)
2020

2021

2022

(FY)

Operating revenue (Unit: ¥billion)

Overland Transportation BusinessAlthough there were new distribution center operations,sales remained at the same level as the previous year
due to a decrease in project cargo handling.

48.214 52.017 51.847

Fiscal 2022 operating revenue¥

51,847 million (down 0.3% year on year

)
2020

2021

2022

(FY)

Business strategy
Warehousing and Distribution Business● Optimize management resources

Expand businesscentered on thegrowth of priority
areas

contributing to the realization ofsustainable society● Develop logistics bases and networks inJapan and overseas

Overland Transportation Business
Expand businesscentered on thegrowth of priority
areas

Create new value
using cutting-edge
technology

Social value
through business

Friendly Warehouses in Japan andoverseas● Promote the introduction of LED lighting
and other equipment that reduces theenvironmental impact

and overseas●F urther improve the quality ofpharmaceutical logistics services● Provide safe and secure food/beverage and● Expand Disaster-Resistant and Eco-

Distribution center
management that
contributes to theresolution of social issues● Develop cold chain services in Japan

Collaborate withexternal partners toresolve social issues

pharmaceutical transportation/delivery services
through appropriate temperature control●D evelop cryogenic transportation/delivery
services that can be used in the medical field● Reduce environmental impact throughCO2 emission visualization services, etc.

● Improve the efficiency of the entire supply chain by building the ML Chain pharmaceutical logistics data platform, etc.
● Improve productivity through systemization and develop new services

To expand the “Disaster-Resistant and Eco-Friendly Warehouses” that the Group is promoting,at the Ibaraki Distribution Center No. 5 in Osaka, which was completed in October 2022, weinstalled solar power generation panels and LED lighting and adopted a seismically isolated
structure. The Group as a whole is, for example, promoting initiatives that include the utilizationof renewable energy by adopting a PPA scheme (details on page 33) and a modal shift in longdistance transportation in collaboration with customers. Through the activities of our businessdivisions, we will promote responses to the climate change issues caused by global warming
and to the natural disasters that have become increasingly severe in recent years.

Mitsubishi Logistics Integrated Report 2023

19

Introduction of Businesses
Logistics
Business

Port and Harbor Transportation Business
Through our Port and Harbor Transportation Business at major Japanese ports, we havecontinued to grow along with economic development, with our top priority being
contributions to socio-economic development.
In addition to aiming to further enhance competitiveness by leveraging our cargohandling services, which rank the highest globally for efficiency, and securing stableprofits, we will promote responses to climate change and contribute to the creation of asustainable society.
Operating revenue (Unit: ¥billion)

Segment overview

Seiji Ueda
General Manager,
Port and Harbor Transportation
Business Division

The container handling volume remained at the same level
as the previous year, and the freight handling volume of
conventional vessels and car carriers increased.

21.33222.950 23.340

Fiscal 2022 operating revenue

23,340 million* (up 1.7% year on year¥)

* Does not include revenue from shipping-related services, such as ship registration and agency operations.

2020

2021

2022

(FY)

Business strategy
Expand business and enhancecompetitiveness of the Harbor
Transportation Business Division
Increase profit margins and improve
profitability
Expand logistics operations related tocargo handling work on vessels andship registration operations

Social value
through business● Expand the conventional shipping freight business and the car carrier business● Strategic operation of independently operated container terminals (Osaka: Nanko C-9, Kobe: Rokko C-4)● Improve profit margins by streamlining operations and reviewing costs at container terminals● Improve profitability by reviewing work systems, etc. for unprofitable operations at subsidiaries

under our jurisdiction● Acquire new business by incorporating the needs of shipping companies and shippers related tocargo handling work on vessels● Strengthen relationships with existing business partners, and strengthen sales activities to expand

the handling of ship registration operations

While prioritizing the safety of employees working at terminals, we will fulfill our mission as
essential workers who protect society even in sudden natural disasters, such as earthquakes
and typhoons, and the coronavirus pandemic. Specifically, at the Yokohama Minamihonmoku
Container Terminal, we are achieving a safe and efficient operating system through unified
management by means of our terminal operation system. With regard to climate change, in linewith the Carbon Neutral Port (CNP) policy promoted by the national and local governments inJapan, we curb energy consumption and contribute to reducing CO2 emissions by increasing
the efficiency and sophistication of logistics operations and facility operations.

Real Estate Business
While continuing to strengthen the earnings base of the real estate rental business and expand thereal estate business that does not depend on land ownership, we will promote initiatives for asset
turnover business utilizing REITs, etc., to create new revenue sources.
In addition to strengthening its earnings base by, for example, the redevelopment andreinvestment of core assets and sale of non-core assets, the Real Estate Division is accumulating
expertise through the acquisition of new projects, such as public-private partnerships (PPP), andparticipation in joint projects with other companies. We aim to become a business operator that
demonstrates high development capabilities and facility management capabilities.
Operating revenue (Unit: ¥billion)

Segment overview

Takashi Mukai

Retail facilities business performance recovered,however, in contrast, condominium sales decreased.

General Manager,
Real Estate Business Division

Fiscal 2022 operating revenue

38,199 million (down 12.5% year on year¥

43.66236.153)2020

20

Mitsubishi Logistics Integrated Report 2023

38.199

2021

2022

(FY)

Logistics
Business

International Transportation Business
Promoting the establishment of a system that responds to trends and changes in global
supply chains, the Mitsubishi Logistics Group’s International Transportation Business isdeveloping logistics services that support customers’ global supply chains, centered oninternational integrated transport operations, such as ocean and air forwarding. We also
support our customers in making their supply chains more resilient in response toenvironmental changes such as pandemics and natural disasters.
Operating revenue (Unit: ¥billion)

Segment overview

Revenue reached a record high due to an increase inimport and export cargo handled through new contracts
and growth in overseas sales as well as increases in freightcosts and the weaker yen.

Yosuke Abe
General Manager,
International Transportation
Business Division

116.21973.59346.514

Fiscal 2022 operating revenue

116,219 million (up 57.9% year on year

¥

)

2020

2021

2022

(FY)

Business strategy
Sales activities centered onpriority areas● Roll out sales activities mainly targeting groups of materials (new materials) whose applications are

expanding due to technological innovation●B y offering comprehensive logistics services, we provide services that optimize customers’ entire supply chains● Overseas, develop areas in line with the characteristics of each region, with a particular focus on the four main regions ofOverseas area strategy

ASEAN, China, North America, and Europe (strengthening ASEAN in particular where economic growth is significant)● In forwarding, work to develop a Global Grid strategy that strengthens collaboration among overseas bases, with a particularfocus on expanding the handling of freight within the ASEAN region and from ASEAN to Europe and the United States

Construction of a digitalplatform, and newtechnologies and new services

Social value
through business●B uild a digital platform to create a better customer experience (CX) through cost reductions, new value creation and faster response●P rovide consulting services that visualize the status of transportation and greenhouse gas emissions, etc., and utilize supply chain

analysis tools

At both Kansai and Narita International Airports, we have obtained quality certification for the airtransportation of pharmaceuticals from the International Air Transport Association (IATA) throughits CEIV Pharma compliance program. We support the global pharmaceutical supply chain andcontribute to protecting the lives and health of people in Japan and around the world.
Also promoting development solutions that include the visualization of CO2 emissions in the
supply chain and countermeasures to address the risks that climate change poses to people
and companies, we aim to realize a prosperous and sustainable society by expanding andsupporting the handling of new sustainable materials.

Business strategy
Strengthen the earnings base of the realestate rental business● Smooth promotion of Shibaura Dia Building development project

Expand real estate business that does notdepend on land ownership● Grand Opening of Kobe Suma Sea World scheduled for June 2024

Social value
through business● Promote merger of two Kansai subsidiaries (Kobe Dia Maintenance Co., Ltd., Osaka Dia Buil-Tech Co., Ltd.)● Kumoi 5-chome District Category 1 Urban Redevelopment Project (Kobe) scheduled for completion in FY2027

To ensure that our tenants can continue their business operations with peace of mind, we aredeveloping office buildings with enhanced earthquake resistance as well as power outage andflood prevention measures in preparation for disasters. From the dual perspective of responding
to climate change and reducing environmental impact, we have also adopted design thatshows environmental aspects have been considered, including the introduction of energysaving systems, the installation of Low-E double-glazed glass to improve insulation, and the useof rainwater to flush toilets. Our design has received a high rank in CASBEE assessments, bywhich the environmental performance of buildings is rated.

Mitsubishi Logistics Integrated Report 2023

21

The MLC2030 Vision and the Management Plan

Outline of the MLC2030 Vision and the Management Plan
The MLC2030 Vision (announced on March 22, 2019)
VisionContributing to the improvement of customer value,

we offer comprehensive logistics solutions to the management of customers’ supply chains,from procurement to distribution/sales, as their partner.
We have established the MLC2030 Vision as the ideal image of the Mitsubishi Logistics Group in 2030 (see page 6: Top Message).

Our growth strategies aimed at achieving this vision are as follows.

1. Establish a customer-oriented support system
The Group will establish a customer-oriented support system with afocus on the medical/health care, food/beverage, and machinery/electrical machine industries as priority areas*, and will take oncomprehensive supply chain challenges as the customer’s partner.
Through these efforts, the Group will seek to expand its businessdomain and boost its market share.
* We have added new materials, the market for which is expected to
expand towards the year 2030, to the Management Plan (2022-2024) tocreate four priority areas.

2. Expand overseas business
The Group will move forward with system enhancements to support
customer supply chains in the medical/health care and food/beverage industries and strengthen its forwarding business withdemand for high-quality cold chains* expected to grow in a numberof regions such as Southeast Asia (ASEAN).
* Services providing uninterrupted temperature-controlled transport anddistribution for refrigerated goods.

3.	Secure stable profits in the Port and Harbor
Transportation and the Real Estate Businesses
The Group will further enhance the competitiveness of the Port andHarbor Transportation Business by leveraging its cargo handlingservices, which rank the highest globally for efficiency, while at thesame time developing commercial complexes and facilities andboosting its operational capability in the Real Estate Business. By
doing so, the Group will seek to secure stable profits.

4.	Improve operational processes and further
utilization of new technologies
The Group will review the operational processes of all businesses
and facilitate efficient operations by utilizing new technologies suchas IoT, AI and robotics. Through these efforts, it aims to improve
service quality and production efficiency.

5. Strengthen the Group management base
The Group aims for growth by strengthening cost competitivenessthrough organizational management across the Company and its
Group companies and securing and developing human resources,
particularly in the priority areas.

Stage 2

Management Plan (2022-2024)
Strengthen the profitability of the Logistics Business
Expand the foundations for the growth ofoverseas business● Expand the Real Estate Business bystrengthening development capabilities● Develop high value-added services byutilizing cutting-edge technology● Strengthen the Group management baseSee page 24

●

●

●

Basic
policies

Numerical
targets

Operating income

20.0 billion (FY2024)
ROE
7% (FY2024)
DOE continuously 2% or more


●
●

¥

Stage 1
Management Plan (2019-2021)：Achieved numerical targets
Evaluation：Steadily implemented key measures：Capital efficiency needs further improvement

22

Mitsubishi Logistics Integrated Report 2023●

Numerical
targets

Operating income


●

DOE

¥

14.5 billion (FY2021)
2.0% (FY2021)

Review of the Management Plan (2019-2021)
Status of achievement (quantitative)■ Although sales and profits decreased in fiscal 2020 due to

COVID-19 (reduced volume of freight handled, partial closuresof commercial facilities, etc.), sales and profits both increased
in fiscal 2021 as a result of a recovery in the volume of freight
handled and increased ocean and air freight rates.

■ Although the Real Estate Business failed to meet its profit

target, greater business performance of the Logistics
Business contributed to the overall achievement of revenue
and profit targets and the DOE (dividend on equity) target in
the Management Plan (2019-2021).

Differences between financial results and targets in the Management Plan (2019-2021)

(Unit: ¥million)

FY2019(actual results)

FY2020(actual results)

FY2021(actual results)

FY2021(targets)

Operating revenue

229,057

213,729

257,230

240,000+ 17,230

Logistics Business

189,709179,255

215,240

198,700+ 16,540

Real Estate Business

41,19936,153

43,66243,600+ 62△ 1,851△ 1,679△ 1,672△ 2,300+ 628

12,195

11,735

18,144

14,500+ 3,644

Inter-segment transactions
Operating income

Difference
Evaluation(actual result - target)

Logistics Business

7,184

7,232

13,703

9,200+ 4,503

Real Estate Business

10,85910,038

10,316

10,700△ 384

Corporate expenses△ 5,847△ 5,535△ 5,875△ 5,400△ 475

Ordinary income

16,822

16,01323,151

17,100+ 6,051

EBITDA (Operating income + Depreciation)

26,447

26,59533,61030,100+ 3,510

Profit (attributable to owners of parent)

11,851

39,16017,892

ー

ー

ー

ROE
Amounts per share of cash dividends applicable tothe year/Annual dividend per share (yen per share)
DOE

4.1%

12.9%

5.4%

ー

ー

ー
ー

60

60

80

ー

ー

1.8%

1.7%

2.0%

2.0%

± 0%

Status of achievement (qualitative)■ We steadily implemented the key measures set out in the management

plan, including by developing the business foundations of the priority
areas, opening a distribution center (Misato City, Saitama Prefecture) for
e-commerce utilizing new technologies, and bolstering production
efficiency through more efficient operational processes and other means.

■ In the Real Estate Business, we acquired profitableproperties, such as joint equity in GRAND FRONTOSAKA. We also promoted the strengthening of ourmanagement system to further expand our business.

Key measures, main initiatives, and tasks of the Management Plan (2019-2021)
Key measures

Main initiatives● Completed Seishin Distribution Center Phase 2 Building in Kobe, Minamihonmoku

Strengthening the business foundationsof the priority areas

Establishing a system that leverages
new technologies
Maintaining competitiveness in the Portand Harbor Transportation Business
Improving the organizational structure to strengthen capabilities
for the development and operation of commercial complexes
and other facilities of the Real Estate Business
Bolstering production efficiency
through more efficient operational
processes and other means
Improving operational conditions to reform
workstyles and create innovation
Increasing shareholder returns
Promoting CSR-oriented management

Distribution Center in Yokohama, Misato Distribution Center No. 2 Phase 2
Building in Saitama, and Ibaraki Distribution Center No. 4 in Osaka● Formed business alliances with K.R.S. Corporation, Cryoport, Inc. and others● Rolled out DP-Cool services nationwide● Expanded storage and delivery operations for automotive parts● Opened “SharE Center misato,” a distribution center for e-commerce● Strengthened collaboration with start-up companies through VC

investment● Introduced a proprietary terminal operation system● Acquired joint equity in GRAND FRONT OSAKA● Reinforced rental facilities around Nagoya Station● Bolstered profitability in the Logistics Business through more efficient

operational processes and other means● Conducted verification tests for improved operational efficiency atwarehouses using AI● Revised the personnel system and promoted diverse workstyles● Increased dividend to ¥80 per share and implemented buyback of ¥20.0

billion treasury shares, exceeding the plan (targeting ¥15.0 billion)● Announced “Initiatives by the Mitsubishi Logistics Group for ESG

Management and the SDGs”● Issued the Integrated Report in place of the Environmental and Social Report

Tasks

Evaluation● Promotion of sales andinvestment in each priority area

● Strengthening of overseas

business foundations● Development of profitablebusinesses● Rebound from the COVID-19 impact● Response to reduced freight volume● Improvement of the organizational

structure to strengthen
operational capabilities● Further improvements to

productivity● Utilization of human resources,

including at Group companies● Improvement of capital efficiency● Strengthening of initiatives

Mitsubishi Logistics Integrated Report 2023

23

The MLC2030 Vision and the Management Plan
Management Plan (2022-2024)
Basic policies
1 Strengthen the profitability of the Logistics Business■ Expand business in the three priority areas of medical/health care, food/beverage, and machinery/electricalmachines in order to realize the MLC2030 Vision■ Add new materials, a market which is expected to expand towards the year 2030, to the priority areas■ Strengthen the earnings power of the Logistics Business by increasing profits through the acquisition of new

businesses and the cultivation of existing businesses, and by improving profit margins through improved operational
efficiency and the collection of appropriate fees.

2 Expand the foundations for the growth of overseas business■ Global Grid Strategy

Contribute to the optimization of customer supply chain management by promoting the establishment of a systemthat responds to trends and changes in global supply chains

Strengthen and upgrade intra-regional logistics and forwarding, and create synergies
Establish a business operation base that mainly consists of local staff● Accelerate growth through a partnership strategy with leading logistics companies●●

Strategic
targets

FY2020 actual results
Overseas sales ratio …… 11.2%         20% or above

FY2024 target

3 Expand the Real Estate Business by strengthening development capabilities■ Continue to strengthen the earnings base of the real estate rental business and expand the real estate business that

does not depend on land ownership.

■ Aim to create new revenue sources, and consider initiatives for asset turnover business utilizing REITs, etc.

4 Develop high value-added services by utilizing cutting-edge technology■ Aim to resolve social issues and realize business growth in both the Logistics and Real Estate Businesses byproactively introducing cutting-edge technology●●

Increase efficiency and sophistication of logistics operations and facility management
Develop logistics platform services

5 Strengthen the Group management base■ Establish a management base that is resistant to changes and risks through thorough risk management and humanresource development.

■ Improve operational efficiency by reviewing the operations for which we are responsible, including at Group

companies, and optimizing the organization.

Human resources
Improve efficiency
Improve efficiency by reviewing andeliminating operations● Improve efficiency by integrating operations● Develop an environment that utilizes digitaltechnology● Conduct a review of responsible operations
with Group companies● Optimize the organization●

 Improve employee satisfaction● 
Ensure diversity of humanresources● 
Develop global human resources● 
Address workstyle reforms● Develop digital human resources●E nhance PR activities● Enhance IR activities

 Review delegation of authority and internal practices
 Foster a corporate culture that supports newchallenges and innovation●●

Risk management
 Strengthen response to disasters andinfectious diseases● Strengthen response to industrial safety and health● Strengthen response to cybersecurity● D evelop IT infrastructure for business continuity● 
Appropriate facility maintenance and management● 
Strengthen internal auditing●

PR and IR●

Reform the corporate culture

StrengthenGroupmanagement
base

Numerical targets
Operating income

20.0 billion¥(FY2024)

24

Mitsubishi Logistics Integrated Report 2023

ROE

7%

(FY2024)

DOE

2

continuously %or aboveDetails of basic policies of the Management Plan (2022-2024)
HOME ▶ IR information ▶ Management policy ▶ Management Plan

Progress of Measures Taken
1 Strengthen the profitability of the Logistics Business■ Medical/health care: Completed the Ibaraki Distribution Center No. 5 in Osaka in

October 2022. By opening a new pharmaceutical warehouse in the Ibaraki City area,
where our pharmaceutical distribution centers are concentrated, we will strengthen ourpharmaceutical storage and delivery functions and develop high-quality logistics
services.
■ Food/beverage: Having entered into a business alliance agreement with K.R.S.
Corporation in January 2022, we are creating synergies by reorganizing existing
operations and systems, and deploying collaborative sales that combine the services ofboth companies. Our efforts have led to results that include the operation of dedicatedcollection and delivery services for the restaurant industry.
■ Machinery/electrical machine industries: The Company has been entrusted with thecomplete logistics operation for BYD Auto Japan Co., Ltd. —the Japanese subsidiaryof the BYD Group, which is expanding sales of its electric vehicles (EVs) globally—from
the port entry, maintenance, and domestic transportation of EVs to the storage andnationwide delivery of aftermarket parts. Leveraging the automotive logistics know-howthat the Mitsubishi Logistics Group has cultivated over the years, we will work to further
expand our business.

2 Expand the foundations for the growth of the Overseas Business
By strengthening the sharing of customer and project information, we have expanded the handling of freight within the
ASEAN region and to and from ASEAN between Europe and the United States. Thanks to these efforts, the rise inmarine freight transportation rates, and the contribution of the weaker yen, our overseas sales ratio rose to 21.5% in
fiscal 2022, exceeding the goal of 20% set to be achieved in fiscal 2024.
Additionally, in August 2022 and April 2023, we acquired shares in In Do Trans Logistics Corporation, a logistics
services provider in Vietnam, which has become an equity method affiliate of the Mitsubishi Logistics Group. By
combining the know-how and customer networks of both parties, such as leveraging the company’s cold chain
logistics in the food/beverage and medical/healthcare fields on which the Group focuses, we aim to expand ourbusiness not only within Vietnam but throughout the Indochina Peninsula.

3 Expand the Real Estate Business by strengthening development capabilities
Utilizing a Park-PFI system, the Suma Aqualife Park and Seaside Park Redevelopment Project will newly redevelop
facilities at the Suma Seaside Aquarium/Seaside Park, located a five-minute walk from Suma Kaihinkoen station on the
JR Kobe Line. The project consists of a park, an aquarium, accommodation, lively entertainment facilities, and aparking lot.
Having adopted the theme “Realization of a connected seaside resort park where local communities and tourists caninteract” for the redevelopment, we are working to create places and structures that will create a variety of connections
and exchanges. The park and entertainment facilities are scheduled to open in September 2023, and the new
aquarium and accommodation facilities are scheduled for a grand opening in June 2024.

4 Develop high value-added services by utilizing cutting-edge technology
Utilizing blockchain and other technologies, the Company built “ML Chain,” a logistics platform for pharmaceuticals to
realize the visualization of entire supply chains and sophisticated quality control.
While utilizing existing business processes, the introduction of automating and streamlining systems has led to
improvements in both logistics service quality and productivity. For example, one system for the optimization of cargo
placement and work personnel utilizes cutting-edge technology such as AI at key points, and another utilizes robotics
technology, such as AGVs.
In recognition of these efforts, we were selected as a Noteworthy DX Company in the Digital Transformation Stocks(DX Stocks) 2023, jointly selected by the Ministry of Economy, Trade and Industry and the Tokyo Stock Exchange.

5 Strengthen the Group management base
To quantitatively ascertain the level of employee engagement, we conducted an engagement survey targeting theCompany and its domestic consolidated subsidiaries. We will plan and implement measures based on the survey
results to maintain and improve organizational strength.
In January 2023, we formulated the Mitsubishi Logistics Group Human Rights Policy based on the United Nations
Guiding Principles on Business and Human Rights. This policy is positioned as the top policy regarding efforts torespect human rights in the Group’s business activities. Going forward, we will advance preparations geared toward theimplementation of human rights due diligence.
Mitsubishi Logistics Integrated Report 2023

25

The MLC2030 Vision and the Management Plan

Capital policy
Capital allocation■ Having proceeded with the sale of cross-shareholdings exceeding those in fiscal 2019-2021, in terms of investment wewill utilize external borrowings, etc. to expand profits and improve capital efficiency, while considering the soundness of
our financial position.
■ We will make investments to achieve the MLC2030 Vision and address ESG management and the SDGs, and will also
promote the return of profits to shareholders.
FY2019-2021 Cumulative cash flowIN

FY2022-2024 plan Cumulative cash flow

OUT
Sale of shares,
etc.

Sale of shares,
etc.
External borrowings, etc.

¥20.0 billion¥15.0 billion

Logistics¥40.0 billion
Real estate¥65.0 billion

Operating CF
and others

External
borrowings, etc.

OUT

¥40.0 billion

Logistics¥40.0 billion
Real estate¥40.0 billion¥40.0 billion

Business
investments

Investments
Operating CF
and others¥106.0 billion*¥36.0 billion

IN¥50.0 billion

Strategic
investments¥50.0 billion

Shareholder
returns¥100.0 billion

Shareholder
returns* “Operating CF and others” for FY2019-2021 includes approximately ¥36.6 billion in compensation income, etc. received from the sale of land in front of Nagoya Station.

Investment plan

FY2022-2024 plan Cumulative cash flow

Business
investment

Maintain and strengthen the competitiveness of existing businesses(acquisition and renewal of facilities and real estate, etc.)

Strategic
investment

Expand business portfolio and create new business domains(DX, IT-related investment, new business development, M&A,
environmental initiatives, etc.)■ Logistics¥40.0 billion■ Real estate¥40.0 billion¥50.0 billion

Enhancement of shareholder returns and improvement of capital efficiency■ We position the return of profits to shareholders as one of the most important management issues, and will strive tofurther enhance shareholder returns.

■ While taking into account the balance among corporate performance, growth investments, and capital efficiency, we

will achieve stable and continuous dividends with a DOE of 2% or above, and flexibly acquire treasury shares on a scalethat exceeds the execution amount during the period of the Management Plan (2019-2021) (with a target of ¥30.0
billion or more).
■ We will accelerate the reduction of cross-shareholdings after continuously verifying the rationality of such holdings, anduse the proceeds from their sale for strategic investment and shareholder returns.
Amount of acquisition of treasury shares
Actual results for
FY2019-2021(3-year cumulative total)

Trends in the number of cross-shareholding sales
Total ¥40.0 billion
or more(Unit: ¥billion)

Plan for FY2022-2024(same as on left)

16.0
14.0

12.0

12.0

¥20.0 billion¥30.0 billion or above

10.0
8.0

* The maximum total number of treasury shares held is set at around 5% of thetotal number of shares issued, and any shares exceeding this shall, in
principle, be canceled.

6.0

6.0

6.8

7.6

4.0
2.0

1.3

0
2018
(FY)

26

Mitsubishi Logistics Integrated Report 2023

2019

2020

2021

Management Plan
(2022-2024)

Initiatives for ESG Management and the SDGs

The Mitsubishi Logistics Group has identified six key themes
in its bid to realize the MLC2030 Vision.

Human resource development,
employee satisfaction
Cutting-edge technology, innovation
Partnerships
Environmental initiatives• Promote the reduction of CO2
emissions throughout the supply
chain and promote decarbonization
efforts by the Company and its
customers• Strengthen service competitiveness• Address the labor shortage• Establish an environment that facilitates
the creation of innovative ideas• Secure diverse human resources

Compliance, human rights, gender• Deepen trust from stakeholders• Reduce sustainability risk
throughout the supply chain

Safety, security, disaster response• By providing services even during
disasters, etc., we will protect ourcustomers’ supply chains andcontribute to a safe and secure society

Mitsubishi Logistics Integrated Report 2023

27

Initiatives for Each of the Six Key Themes

Measures to be Taken, Performance Indicators, and Target Values
Measures to be taken through business activities, performance indicators for each measure, target
values, and progress made in the fiscal year under review are set out in the chart below. Through the
Sustainability Committee, we will promote initiatives to ensure that we meet the targets that have been
set for fiscal 2030. These initiatives will include progress management, the periodic inspection andSix key themes

Priority measures and measures through business activities

Provide infrastructure services that are sustainable evenduring disasters❶ Earthquake resistancestandards for facilities

resistance that surpasses the requirements of various laws andregulations● Secure fuel for business continuity at distribution centers and intransportation operations during large-scale disasters❷ Percentage of required fuelsecured in target regions● Develop facilities with strong earthquake and wind pressure

Safety, Security,
Disaster Response Develop high-quality logistics services that utilize temperature
controls and security capabilities in Japan and overseas● Further utilize DP-Cool vehicles for temperature-controlled

transportation of pharmaceuticals

Further develop Disaster-Resistant Eco-Friendly
Warehouses and eco-friendly office buildings that serve to
reduce GHG/CO2 emissions● Consider the environment through electricity supply by solar power

generation, reduce power consumption through LED lighting inwarehouses

Environmental
Initiatives

Performance indicators*1❸ Utilization rate of DP-Coolvehicles for temperaturecontrolled transportation ofpharmaceuticals❶ CO2 emissions reduction
rate

Reduce GHG/CO2 emissions by enforcing efficienttransportation methods, etc.

● Realize efficient delivery by improving loading rates, etc., shorten

waiting time using a truck reservation system, mount cargohandling equipment with fuel cells towards a CNP❷ CO2 emissions reduction
rate for transportation

Enhance and automate logistics/real estate services andsave labor● Logistics: Optimize warehouse operations and car allocation

Cutting-Edge
Technology, Innovation

planning using AI, etc., respond to EC logistics, etc., automate
equipment in warehouse facilities and make it labor-saving● Real estate: Enhance and save labor of facility management
operations using IT

Collaborate with startups and companies in other industries
Partnerships● Optimize development and create new businesses through open

innovation with CVC, etc.

Develop personnel and welfare programs that value eachindividual employee● Establish a personnel system that accommodates a variety of

Human Resource
Development,
Employee
Satisfaction

workstyles● Create an environment that helps balance work and life

Develop human resources with global perspectives● Develop human resources with global perspectives throughexpansion of training programs, etc.

Promote sincere and fair business activities
Ensure thorough compliance, with awareness ofcomprehensive supply chains
Compliance,
Human Rights,
GenderDX, IT-related investment
amount

CVC fund’s managed amount❶ Ratio of regional generalemployees❷ Ratio of employees taking
child-care leave❸ Ratio of employees withexperience in overseas
assignments❶ Response rate for Code of
Conduct questionnaire andSustainability questionnaire*4● Implement initiatives for adherence to relevant laws and regulations

and respect for human rights together with subcontractors

NEW   Promotion of women’s empowerment● Building systems and creating environments in which women canplay active roles❷ Ratio of female managers*5*1 For details on performance indicators, please refer to Performance Indicators and Targets from page 30.
*2 Figures other than that for the ratio of female managers are rounded to the first decimal place.
*3 Starting from this report, the calculation method has been revised to reflect the effects of reducing CO2 emissions due to the introduction of real renewable energy.

28

Mitsubishi Logistics Integrated Report 2023

replacement of relevant measures and KPIs, and the expansion and upgrading of communication withall internal and external parties through resources such as the Integrated Report and the Group’s
official website.
Target values for FY2030

Results for FY2022*2❶ Maintain 110% ofearthquake resistancestandards

Maintenanceachieved❷ 100% of requirement
secured27%

Activities in FY2022●

Seismic isolation structure
adopted at Ibaraki Distribution
Center No. 5 in Osaka●

Expanded fuel supply
systemExpanded temperaturecontrolled transportationand delivery by DP-Coolvehicles throughnegotiations with customers● Installed renewable electricity
in four buildings of the Real
Estate Business Division● Considered and developed aplan for the installation ofsolar power generation
systems at existing
warehouse facilities● Implemented measures toimprove loading rates
through customer
negotiation●❸ 100% temperaturecontrolled transportation
with DP-Cool vehicles

38%❶ CO2 emissions: down
50% (versus FY2013,
Scope 1+2)(23)%*3❷ CO2 emissions: down
50% (versus FY2018)(43)%

Established a logistics
platform for pharmaceuticals
in the Warehousing andDistribution Business● Renewed the forwarding
system (FFS) in the International
Transportation Business

Activities Planned for FY2023●

Maintain earthquake resistancestandards

Plan and implement measures toimprove the maintenance rate of thefuel supply system● Promote high-quality services such
as ML Chain and improve
temperature-controlled
transportation and delivery using DPCool vehicles.
●

Consider additional GHG/CO2
reduction measures● Develop CO2 emission visualization
service for domestic warehousing
and transportation●●

Consider and implement measures
to further improve loading rates●

Cumulative investment of¥50.0 billion for FY2021FY2030¥8.34 billion(cumulative total)

Gathered information anddecided how to respond to theestablishment of a CVC fund● Temporarily assigned personnel
to a VC fund (2 persons)● Expanded recruitment quotas
for regional general positions● Established rules for
publicizing the malechildcare leave system,
conducted training, andreviewed operations● Established institutionalframework for broadening theoverseas dispatch program● Maintained response rate for
Code of Conduct questionnaire● Enhanced the content of thesustainability questionnaireand expanded the numberof companies covered

Expand ML Chain functions andincrease the number of customers● Continue development of FFS,
launch of CO2 emissions visualization
service, etc.
●●

Establish a CVC of ¥5.0
billionPreparations for CVC
launch

❶ 30%

8%

❷ 60%

56%

❸ 25%

16%
Code of Conduct
questionnaire96%● Sustainability
questionnaire94%●❶ 90% or more each year●●

Establish investment subsidiary
Form a CVC fund●Expand recruitment of regional
general employees●

Create a pamphlet on the new
childcare leave system and raisingawareness of the system to increase
the uptake rate●

Expand overseas dispatch program

Improve the response rate for Codeof Conduct questionnaire● Enhance the content of thesustainability questionnaire (expand
to include more companies in Japan)●

Secure human resources throughearly screening, training, and selection
as well as the mid-career recruitmentof female executive candidates● Consider measures to increase the ratioof women in management positions
●

❷ 10%

2.6%

●

Examination of performanceindicators and fiscal 2030
target values*4 Formerly the CSR questionnaire*5 Newly established in fiscal 2023. See page 49 for details.

Mitsubishi Logistics Integrated Report 2023

29

Initiatives for Each of the Six Key Themes

Safety, Security, Disaster Response
By protecting our customers’ cargoes and business fromfuture risks and creating tomorrow’s logistics today,
we will provide peace of mind in 2030 and beyond.
Throughout our 137-year history, we have taken safety and security as
our starting point and brought about the evolution of both our logistics
facilities and information systems in preparation for emergencies.
Strengthening both the “hard” and “soft” aspects of our advanced
quality control and nationwide logistics network, we will continue
to meet the expectations of our customers.

Priority Measures and Measures through Business Activities
Provide infrastructure services that are sustainable even during disasters → Performance indicators ❶・❷● To prepare for earthquakes and the increasing severity of weather-related natural disasters brought about by
climate change, we are developing and deploying disaster-resistant facilities with both seismic and wind pressure
resistance that exceeds all types of statutory and regulatory requirement.
● By installing light oil in-tanks for stockpiling, entering into priority fuel supply contracts with oil distribution
companies in case of a disaster, and other initiatives, we have developed systems to secure fuel should a largescale disaster occur.
Develop high-quality logistics services that utilize temperature controls and security capabilities → Performance indicator ❸● Providing the high-quality DP-Cool temperature-controlled pharmaceuticals delivery service, we are supplying safe
and secure pharmaceuticals through the expanded use of those services.

Performance Indicators and Targets

Fiscal 2022 Topics and Initiatives from Fiscal 2023 Onwards❶ Earthquake resistance standards●
for facilities

In fiscal 2022, for Fuji Logistics Co., Ltd.’s Tsukuba Logistics
Center in Ibaraki Prefecture, which was completed in April, we
ensured a seismic resistance standard (required horizontal
strength*) of 110% or higher, as stipulated by the BuildingStandards Act, which is the same as our standards. At Ibaraki
Distribution Center No. 5 in Osaka
Prefecture, which was completed in
October, we employed a seismic-isolated
structure. In addition, the building has astructural strength against wind pressureof 115%, as stipulated in the BuildingStandards Act.
From fiscal 2023 onwards, we will
Osaka/Ibaraki Distribution
continue to carry out initiatives that
Center No. 5
maintain seismic resistance and windSeismic isolation rubberpressure resistance standards.

Target values for FY2030

Maintain 110% of earthquake
resistance standards
Targeting logistics and real estate facilities owned by the Company that will
be completed and begin operation from April 1, 2021 onward* The strength required for a building to withstand the horizontal forces experienced during anearthquake.

❷ Percentage of required fuel secured●
in target regions
Target values for FY2030

100% of requirement secured
Targeting Nankai Trough Earthquake Disaster Countermeasure Promotion
Area as designated by the Cabinet Office
Percentage of required fuel secured for use during large-scale
emergencies for logistics facilities owned and operated by the Company
with an area of approximately 16,550 m2 or more through maintaining
reserve kerosene stored in-tanks, and contracts with oil distribution
companies for priority fuel supply during disasters, etc.

30

Mitsubishi Logistics Integrated Report 2023

At Osaka/Ibaraki Distribution Center No. 5, which was completedin October 2022, we installed an emergency generator and lightoil in-tank to assist in maintaining thestable supply of pharmaceuticals in theevent of a large-scale disaster.
In fiscal 2023, we will work to enhanceand upgrade our partner company andbusiness continuity systems, such as fuel Osaka/Ibaraki Distribution
Center No. 5
supply companies, in other regions.
Emergency generator

Performance Indicators and Targets❸ Utilization rate of DP-Cool●vehicles for temperaturecontrolled transportation ofpharmaceuticals
Target values for FY2030

100% temperature-controlled
transportation with DP-Cool vehicles
Utilization rate of vehicles compatible with the DP-Cool temperaturecontrolled pharmaceuticals delivery service provided by the Group company
Dia Pharmaceutical Network Co., Ltd.

Fiscal 2022 Topics and Initiatives from Fiscal 2023 Onwards
In addition to the GDP-compliant DP-Cool temperature-controlled
pharmaceuticals delivery service that we started providing in
2016, the Company and DP Network began offering DP-Green, atemperature-controlled* pharmaceuticals delivery service thatcomplies with GDP guidelines, from November 2022. We haveworked to strengthen our high-quality transportation and delivery
services to ensure the safe and secure delivery ofpharmaceuticals.
In January 2022, we began operating ML Chain, a
pharmaceutical logistics data platform that utilizes information
technology such as blockchain. By utilizing ML Chain, our Groupaims to visualize entire supply chains and assist customers insolving their problems and thereby improve efficiency.
In FY2023, we will continue to contribute to the stable supply ofpharmaceuticals by expanding our handling of high-quality
pharmaceutical transportation and delivery services, such as
DP-Cool and DP-Green.
In working to enhance and upgrade the functionality of ML
Chain, we will also aim to provide new added value to everyone
involved in pharmaceutical distribution, including pharmaceuticalmanufacturers and wholesalers as well as transportation company
operators.
* 1–30°C

Toward solving social issues through business

Execution

IT System Basic Policy

Learning from past disasters, we have been actively investing to “protect our customers’ businesses and society.”
Amid the uncertainties caused by the prospects of a Great Kanto Earthquake, we built a reinforced concrete
warehouse without delay, thereby protecting the products entrusted to us by our customers and prioritizing theirpeace of mind. To prevent repeats of past painful experiences, such as the aftermaths of the Great Hanshin-Awaji
Earthquake and the Great East Japan Earthquake, we have been promoting the building of sustainable
warehouses that can withstand seismic events and in 2012 launched the Disaster-Resistant and Eco-Friendly
Warehouse concept.
In considering possible disaster scenarios,even those affecting IT systems, we determined
Emergency
Maintenance/
Education/
Prior measures planthat these would include not only large-scale
response plan
improvement plan
training plan
earthquakes and wind and flood damage but
BackupDisaster recovery
System operation
Emergency usage system,
recovery methods(DR) methods
structuresuch as remote connection
also infectious diseases, widespread power
Execution
outages, large-scale IT system failures,
IT infrastructure development to improve business continuity
cyberattacks, data leaks, terrorism and(Backup method adopted for each system, and DR environment facilities
mandatory for main operations)conflicts. From an IT system perspective, weare strengthening our response to all-hazard
Implementation of Group-wide disaster/fault training (required once a year),inspection and improvement of training content, etc.
BCPs and redoubling our efforts to ensurebusiness continuity for our customers.

VOICE

High-quality logistics warehouse for pharmaceutical GDP
Ibaraki Distribution Center No. 5 in Osaka Prefecture, where I was in charge of all construction work, is alogistics warehouse that complies with the pharmaceutical GDP guidelines. We installed an automatic
shelter that can be directly connected to the refrigerated cargo handling area on the first floor andair-conditioning fans to circulate air into the shaft of a vertical conveyor, allowing us to provide highquality pharmaceutical logistics services with no changes in temperature during a series of cargohandling operations. In cold storage with a narrow temperature control range of 2–5°C, we also aimed
to further improve quality by installing a new-technology, nozzle-type fan, so that uniform temperature
and airflow can be maintained.
Based on our “Disaster-Resistant and Eco-Friendly Warehouse” concept, we also adopted a seismic
isolation structure and installed a large-output emergency generator to enable business continuity evenin the event of a disaster. Out of environmental considerations, we adopted solar power generationequipment and high-efficiency air conditioners to reduce our environmental impact.

Shoko Tsujita
Real Estate Dept.,
Osaka Branch

Mitsubishi Logistics Integrated Report 2023

31

Initiatives for Each of the Six Key Themes

Environmental Initiatives
Through efforts to reduce environmental impact, which is a climatechange issue, we will set the beautiful Earth spinning toward thefuture while assisting our customers’ businesses.
We believe that partnerships with customers and everyone involved inlogistics are extremely important in reducing CO2 emissions throughout the
supply chain. While continuing to promote energy conservation, we will
expand investment in renewable energy and, as our main initiative,
promote the reduction of environmental impact by realizing efficienttransportation and delivery.

Priority Measures and Measures through Business Activities
Further develop Disaster-Resistant and Eco-Friendly Warehouses and eco-friendly office buildings thatserve to reduce GHG/CO2 emissions → Performance indicator ❶● At our distribution centers, which are positioned at the core of our supply chain, we are working to reduce theenvironmental impact by promoting the visualization of environmental burden-related figures such as CO2 andwaste emissions, the introduction of green power such as solar power generation, and the conversion of lighting
equipment to LED lighting.
Reduce GHG/CO2 emissions by enforcing efficient transportation methods, etc. → Performance indicator ❷● In order to reduce CO2 emissions from the Group’s transportation/delivery operations, we will establish a method
for measuring emissions, shorten truck waiting time using a truck reservation system, optimize transportation
methods through modal shifts, and consider the introduction of next-generation vehicles, including EV trucks. We
will also work on the introduction of cargo handling equipment mounted with fuel cells towards realizing a CNP(carbon neutral port).

Performance Indicators and Targets

Fiscal 2022 Topics and Initiatives from Fiscal 2023 Onwards❶ Reduction rate of CO2 emissions●
at facilities

In fiscal 2022, Ibaraki Distribution Center No. 5 in Osaka Prefecture wascompleted as a Disaster-Resistant and Eco-Friendly Warehouse. At thiscenter, we installed solar power generation equipment (200kW) on theroof and LED lighting throughout the facility, motion sensors for lighting incommon areas, high-efficiency air-conditioning
equipment, and heat-shielding as well as
high-insulation, double-glazed glass (Low-E
glass). Due to these energy-saving measures,
we received an “A” ranking from CASBEE(Comprehensive Building Environmental
Performance Evaluation System) in Osaka
Prefecture. Up to the time of the equipment’s
installation at Ibaraki Distribution Center No. 5 Solar power generation
at Ibaraki
in fiscal 2022, the total solar power generation equipment
Distribution Center No. 5 incapacity of the Company was 4,713 kW.
Osaka Prefecture

Target values for FY2030

CO2 emissions in Scope 1 and 2 of the
GHG Protocol:down 50% (versus FY2013)
Targeting logistics and real estate facilities owned by the Company and its
Group company, Fuji Logistics Co., Ltd., and in-house transportation by
Ryoso Transportation Co., Ltd.

❷ GHG/CO2 reductions through●efficient transportation/delivery
Target values for FY2030

CO2 emissions:down 50% (versus FY2018)
Targeting vehicles compatible with the DP-Cool temperature-controlled
pharmaceuticals delivery service provided by the Group company Dia
Pharmaceutical Network Co., Ltd.

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Mitsubishi Logistics Integrated Report 2023

Having worked hard to improve the loading rates for DP-Cool, ourtemperature-controlled pharmaceuticals delivery service, for products
transported and delivered using this service, we have reduced CO2
emissions per product weight and transportation distance.
As an initiative other than setting target values, we utilized therefrigerated transportation and delivery network of K.R.S. Corporation,with which we entered into a business alliance agreement in January
2022. Frozen and refrigerated cargo, which
had previously been arranged by eachsupplier and was transported from the Kanto
region to the Kansai region is consolidated at
K.R.S. bases and transported by joint routes,
reducing the number of transportation
vehicles and CO2 emissions by means of
A DP-Cool truck
shared trunk-line transit.

Fiscal 2022 Topics and Initiatives from Fiscal 2023 Onwards
In fiscal 2023, we plan to provide CO2 emission calculation tools and visualization services to reduce CO2 emissions fromfacilities and transportation operations.
The calculation tool is a service that allows customers to simulate CO2 emissions for a variety of domestic andinternational transportation and delivery routes. By simply entering the departure and arrival locations, weight and otherparameters, the tool will suggest the optimal transportation route to suit a customer’s needs from a number ofperspectives, including transportation method, lead time, and amount of CO2 emitted.
The visualization service reports the amount of CO2 emitted when customers use our logistics services (warehousing/domestic transportation and delivery).

Toward solving social issues through business
By promoting energy conservation and the introduction of renewable energy in our facilities, we will reduce our CO 2
emissions, which is Scope 3 when seen from the customer’s perspective, and proceed with service development
while assuming future risks, such as the increased customer costs due to the introduction of a carbon tax. To thisend, we started offering a CO2 emissions visualization service in fiscal 2022 and plan to offer a reduction service atsome stage thereafter. We will strengthen efforts to combat climate change throughout the supply chain whileaiming to achieve net zero CO2 emissions by 2050.

In addition to the CO2 emissions calculation tool posted online, we also provide a CO2 emissions visualization service
that reports emissions results for each customer, and a reduction proposal service based on the visualization results.
Overall picture of the service
The Company

Service users
Logistics users

Enter transportation
weight, distance,and mode

CO2 emissions
calculation
results

The Company’s
customers

Transportationcompany
operator

CO2 emissions
reportCO2 emissions
reduction
proposal

CO2emissionscalculationtool● Enables calculation ofCO2emissionsvisualization
service● The Company provides

CO2
emissions
reduction
proposal
service

CO2 emissions fromtransportation via our
website

輸送
モード

Transportation
data acquisition

貨物重量 XX ton
出発地

XX

目的地

XX

Visualization system

reports on CO2 emission
results for warehousing/transportation bycustomer.

● Proposes logistics

solutions that contributeto reduction based on
CO2 emission
visualization resultsOFF

As our customers’ logistics partner, we support the visualization and reduction of CO2 emissions.

VOICE

PPA model for solar power generation system
Having installed a PPA-model (third-party ownership) solar power generation system in Building A of its
Mie Logistics Center, Fuji Logistics Co., Ltd. began its operation in January 2023.
Under the terms of this business model, the company is leasing the roof facilities to a PPA operator,
which has installed an 801 kW solar power generation system and supplies the electricity generated to
Fuji Logistics.
In addition, since the PPA operator utilizes the Feed-in Tariff (FIT) system to sell any excess electricity
that cannot be used by Fuji Logistics, large-capacity power generation has been enabled by making
maximum use of the roof area.
On sunny days, electricity can be generated almost exclusively from solar power generation, and it isexpected that the annual CO2 emissions from the electricity used at the facility will be reduced byapproximately 70%.
Having also promoted the implementation of the PPA model at our Tsukuba Logistics Center, which
commenced operations in April 2022, we will continue to promote initiatives that lead to the reduction of
CO2 emissions.

Kazunori Sato
Deputy Division
Manager,Engineering &Administration
Division,
Fuji Logistics Co., Ltd.

Mitsubishi Logistics Integrated Report 2023

33

Initiatives for Each of the Six Key Themes
Examples of environmental measure initiatives
To protect our customers’ supply chains and the global environment, we have adopted the concepts of DisasterResistant and Eco-Friendly Warehouses and Disaster-Resistant and Eco-Friendly Office Buildings.
Initiatives designed to promote energy saving and the deployment of renewable energy are as follows.

Initiatives designed to save energy
Under the Disaster-Resistant and Eco-Friendly
Warehouse concept, for newly built warehouse facilities
we adopted: (1) LED lighting throughout the facilities; (2)the installation of high-efficiency air conditioners; and (3)heat-shielding, high-insulation, double-glazed glass(Low-E glass) with the goal of obtaining CASBEE *1 “A”
ranking or higher. Osaka/Ibaraki Distribution Center No. 5,
which was completed in October 2022, received an “A”
ranking from CASBEE Osaka Prefecture.
In existing facilities, besides replacing existing lightingwith LEDs, we are actively installing equipment with highenergy-saving performance.
*1 CASBEE is a method for evaluating the environmental performance of buildings
with a system that comprehensively evaluates the quality of buildings in addition
to facility installations that show consideration has been given to the naturalenvironment, such as energy saving and the use of equipment with a low
environmental burden. This includes the degree of comfort for building users, theconsideration given to the building’s appearance, and measures to reduce
impact on the building’s surroundings, such as the effects of light pollution.

Initiatives for renewable energy deployment❶ The power for four office buildings inTokyo, including the Company’s head
office Nihonbashi Dia Building, will beswitched to electricity derived fromsubstantially renewable energy, whichis expected to reduce CO2 emissions
by approximately 5,500 tons per year.
❷ Promoting the installation of solar
power generation equipment having
been taken on board by the Group asa whole, we are giving consideration
to and installing a variety of methods,
including the third-party ownership(PPA) model for solar power
generation systems.

Other initiatives❶ The Group obtained Green Management Certification*2
from its certification registration organization, theFoundation for Promoting Personal Mobility andEcological Transportation (Eco-Mo Foundation), which
pursues profitability and environmental conservation bypromoting environment-friendly business activities.
Having obtained Green Management Certification at all
five of its branches (six operational bases) in 2005,
Ryoso Transportation Co., Ltd. is promoting initiatives
designed to reduce environmental burden. Specifically,in its efforts to promote eco-driving to improve gas
mileage and reduce emissions of air pollutants, thecompany has set its own high standards for vehicle
inspections and maintenance. The company also
introduces into service low-pollution vehicles that meet
the appropriate latest restrictions for gas emissions.
*2 The Foundation for Promoting Personal Mobility and Ecological Transportation isa public utility foundation that has been certifying and registering business
operators making efforts to reduce the environmental burden at a level exceeding
the standards outlined in the Green Management Promotion Manual since
October 2003.

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Mitsubishi Logistics Integrated Report 2023

1. Certification acquisition status of the Company
All offices of the Warehousing Business Division
Harbor Transportation Business Division(Part of the container terminals of the Port of
Yokohama and the Port of Kobe)
2. Certification acquisition status of the Group
Truck transportation business (Ryoso Transportation
Co., Ltd. and Kyushu Ryoso Transportation Co., Ltd.)and warehousing business (Chubu Trading
Warehouse Co., Ltd., Kusatsu Soko Co., Ltd., and
the Warehousing Business Division of Monryo
Transport Corporation)

 onducting compliance with the Act on Rational Use❷C
and Appropriate Management of Fluorocarbons
According to the Act on Rational Use and Appropriate
Management of Fluorocarbons,*3 companies are
required to inspect commercial refrigerators and air
conditioners, etc. that use fluorocarbons (Class 1
specified products) and report the leakage amount offluorocarbons from the aforementioned products when
it exceeds a specified level. The Company isappropriately responding to the Act by preparing thesystems and operational guidelines related toinspection and leakage control. In addition, in fiscal
2022, the Company’s calculated fluorocarbon leakage
amount was 892.9 [t-CO2], which was below the levelof 1,000 [t-Co2] that is subject to reporting to the
Minister of Land, Infrastructure, Transport and Tourism(the minister having jurisdiction over the warehouseindustry).
*3 Overview of the Act on Rational Use and Appropriate Management of
Fluorocarbons (implemented on April 1, 2015)
The Act requires users (owners, in general) of “Class 1 specified products”(commercial air conditioners, refrigerators and freezers, etc.) to implement a“simple inspection of all specified products” and “periodic inspection by a personwith specialized knowledge.” Furthermore, it also requires users to report thecalculated leakage amount of fluorocarbons if the amount exceeds the specified
level of 1,000 [t-CO2] per year.

❸ In overseas initiatives, we are introducing vehicles thatcomply with local regulations at Shanghai Linghua
Logistics.
Engaged in the warehousing and transportation
business mainly in Shanghai, China, Shanghai Linghua
Logistics Co., Ltd. has introduced trucks that comply
with regulations in line with tightened local exhaust gas
regulations and is consecutively disposing of andreplacing diesel forklifts. The company also engages inenvironmental conservation by taking measures otherthan regulatory compliance, such as installing outdoor
lighting equipped with solar power generation systems.

Newly introduced electric forklifts

Outdoor lighting equipped with solar
power generation systems

Response to TCFD Recommendations
The Company announced its endorsement of the Task Force on Climate-related Financial Disclosures (TCFD*) in June
2022. Based on the framework of the TCFD recommendations, we disclosed information on four items: “Governance,”“Strategy,” “Risk management,” and “Indicators and targets.”* An abbreviation for Task Force on Climate-related Financial Disclosures. The Task Force was established by the Financial Stability Board (FSB) at the request of the G20 toconsider how climate-related information should be disclosed and how financial institutions should respond.

Information disclosure of four items based on TCFD recommendations
Governance and Risk Management
Roles and composition of each meeting body (as of the publication date of this report)
Meeting body

Role

Members
Chairperson: Chairman of the Company
Supervise initiatives and goal management related Directors: 12
Board ofto sustainability issues, including climate change(five of whom are outside directors)
Directors
matters
Corporate Auditors: Five
(three of whom are outside corporate auditors)
Chairman, President, Senior Managing Executive
Discuss sustainability issues, including matters
Officers, Managing Executive Officers (seven
Executive
persons in total) (Observers: Full-Time Corporate
Committee related to climate change, as importantmanagement issues
Auditors)
Chairperson: President
Strategy Meeting:	Deliberate important sustainability Members: 	Chairman, Senior Managing
issuesExecutive Officer, Managing
Sustainability Liaison Meeting:	Monitor policies and targets
Executive Officers, and General
Committee
Managers
related to sustainability issues(Observers: Full-time Corporate
Subcommittee:	Consider countermeasures,
Auditors)
including policy proposals
Administration: 	Sustainability Promotion Division
Chairperson:	Managing Officer responsible forGeneral Affairs
Risk
Identify, analyze, and consider responses andMembers: 	General Managers
Management countermeasures for Group-wide risks, including(Observers: Full-time Corporate
Committee risks of climate change
Auditors)
Administration: General Affairs Division
Oversee the six key themes. Collaborate with
(Sustainability business divisions to formulate roadmaps,
etc.,
Establish departments to act as coordinators forCommittee) including measures to address climate change,andeach subcommittee
Subcommittee
plan, formulate, manage, and promote measures
Organizational chart (as of the date of publication of this report)
Board of Directors
Supervise⬇ ⬆Report

President
Supervise⬇ ⬆ReportSupervise⬇ ⬆Report

Executive Committee

Sustainability Committee

Strategy Meeting
Liaison Meeting

Share

Risk Management
Committee

Subcommittees

Coordinate/Implement

Business Divisions

Affiliated Companies

Mitsubishi Logistics Integrated Report 2023

35

Initiatives for Each of the Six Key Themes
Indicators and Targets

Based on below 1.5°C and 4°C scenarios, we identified
transition risks (risks associated with the transition to a
low-carbon society), physical risks (climate risks
associated with the progress of global warming) andopportunities in the short, medium, and long term, andconsidered the degree of their impact. The mitigation
measures and countermeasures for major risks andopportunities are as follows.

●	Performance indicators
In the Mitsubishi Logistics Group Roadmap for Realizinga Decarbonized Society (hereinafter referred to as “theRoadmap”) announced in September 2023, the Grouppublished its Mitsubishi Logistics Group Net Zero
Declaration and its aim to achieve net zero CO2 emissions
by fiscal 2050.
Going forward, we will be promoting decarbonization in
our Group’s businesses and supply chains, focusing on
initiatives in the priority areas shown in the Roadmap.

In FY2023, the 2˚C scenario was revised to the 1.5˚C scenario, and the impact was
re-evaluated.

● Transition risks

In terms of transition risks, as one example, it was foundthat the impact from carbon taxes and other taxes basedon the amount of emissions of CO2 and other gases(GHGs) that lead to global warming, and the impact fromincreases in the cost of capital investment and facility
replacement to curb the emission of those gases would
be significant.
Mitigation measures are to develop Disaster-Resistantand Eco-Friendly Warehouses and propose environmentfriendly transportation/delivery in the Logistics Business,and to develop Disaster-Resistant and Eco-Friendly Office
Buildings and introduce renewable energy in the Real
Estate Business.
● Physical risks
In terms of physical risks, it was found that the impact ofa decrease in labor productivity due to heatstroke, etc.
among workers and others, and an increase in the costof introducing measures, such as equipment to prevent
such problems, would be significant.
Mitigation measures will be to further promote highly
efficient work operations, introduce new technologies thatmake it possible to reduce workload, and promote
initiatives to provide a comfortable working environment,
including through a review of workstyles.
●	 Opportunities
In the transition to a low-carbon and decarbonizedsociety, there will be a growing need for services with low
CO2 emissions. In addition, the increasing need fortemperature-controlled transportation/delivery due torising temperatures as well as the need for business
continuity and the maintenance of supply chains evenunder circumstances of increased frequency of intensified
disasters due to climate change will constitute an
opportunity that translates into business opportunities,
and its impact was found to be significant.
Countermeasures on the tangible front will be tocontinue to proactively develop Disaster-Resistant and
Eco-Friendly Warehouses and Disaster-Resistant and
Eco-Friendly Office Buildings. On the intangible front, we
will respond to customer needs by proposing logistics
with a low environmental impact, introducing andsupplying renewable energy, enhancing the safety offacilities through planned implementation andstrengthening of facility repairs and storm and flood
damage countermeasures based on our experience indealing with disasters, etc., and by providing robust
logistics services utilizing our knowhow, such as inselecting alternative routes and facilities in the event of adisaster.

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Mitsubishi Logistics Integrated Report 2023

Quantitative
Targets

Strategy

Medium-Term Target(Fiscal 2030)

Long-Term Target(Fiscal 2050)

50% reduction

Achievement of net
zero CO2 emissions(compared with fiscal 2013)(Scope 1+2)*1(Scope 1+2)*2*1 Targeting emissions from the Company and Group companies Fuji Logistics Co.,
Ltd. and Ryoso Transportation Co., Ltd.
*2 Targeting all emissions related to the business of the Company and domestic
and overseas Group companies● Actual results of GHG emissions
Of the GHGs within the scope of the new target values,
actual results of CO2 emissions are as follows. Pleaserefer also to the “Extended version,” which contains dataon CO2 emissions by business.

CO2 Emissions (Actual results)（t-CO2）■ Scope 1 ■ Scope 2

80,00060,00040,00062,28558,58952,88354,07150,32220,000
5,765
0

4,771

5,136

5,111

9,373

2013

2019

2020

2021

2022

(FY)

* To better reflect the CO2 emission reduction effect due to the deployment of
substantially renewable energy, the calculation method has been revised startingwith this integrated report.

Item

Transition risk

Rising GHG
emission-related
pricesIncrease in capital
investment costs
to reduce GHG
emissions
Drop insustainability
ratings

Physical Risk

Increasing
severity ofdisasters due toabnormal weather
events, etc.

Rise in averagetemperature

Rises in sea level

Reduce energy
costs byimproving energy
efficiency

Description
Increases in storage, transportation anddelivery costs for logistics businesses anddevelopment and operating costs for realestate businesses due to introduction oftaxes (carbon tax, etc.) based on GHG
emissions; costs will also increase due to theintroduction of emissions trading system, etc.
To reduce GHG emissions and energy usage,increases in investment and renewal costs fortransportation and delivery vehicles andvarious items of equipment, and forrenewable energy deployment costs
If an appropriate response is delayed, there isa possibility that an increase in capital costs
and debt costs, subordination in acquiring
human resources, a decline in ESG
evaluation, and an increase in compliancecosts may occur.
Insurance premiums for facilities and cargo will
increase due to the intensification of disasters
caused by abnormal weather events, etc. Also, in
the Logistics Business, expenses related to facility
restoration, compensation for stored cargo,
relocation (storage location change), alternative
shipping, etc. due to damage to facilities andcargo may occur. In the Real Estate Business,
profits will decline due to facility restoration costs
and tenant compensation due to damage to officebuildings and retail facilities, as well as adiminished ability to attract customers.
In the Logistics Business, there will be anincrease in air-conditioning costs for facilities
such as warehouses and transportation anddelivery vehicles, and for owned properties in
the Real Estate Business.
Increased risk of heatstroke and decreasedlabor productivity due to heat stress,
increases in personnel costs and in costs forcountermeasures, such as installation ofhigh-efficiency air-conditioning equipment.

Logistics

Opportunities

Adapt to climatechangeProvide climatechangeresponse-related
services

Impactperiod*1

ImpactMitigation/Countermeasures

*2

〇

〇

Short tomediumterm

Major

In the Logistics Business, we will promote the deployment of Disaster-Resistantand Eco-Friendly Warehouses, which have a low environmental impact, andpromote efficient transportation and delivery by proposing environmentallyfriendly transportation and delivery and promoting modal shifts.
In the Real Estate Business, we will promote energy-saving measures, including
the deployment of Disaster-Resistant and Eco-Friendly Office Buildings, theinstallation of and replacement by high-efficiency equipment, and a sophisticatedmanagement system staffed by specialized staff while expanding renewableenergy deployment.

〇〇

Short tomediumterm

Major

We will further promote energy saving, utilize public incentives, andinvest in transportation vehicles and various equipment based on
appropriate specifications that take into account social trends andenvironmental regulations.

〇

〇

Short
term

Minor tomajor

We will advance initiatives under Initiatives for ESG Management
and the SDGs, our company-wide sustainability policy, and provide
detailed explanations to stakeholders.

Minor tomediumIn addition to deploying Disaster-Resistant and Eco-Friendly
Warehouses and Disaster-Resistant and Eco-Friendly Office
Buildings that feature functions to guard against power outages, weare enhancing individual measures such as designing roofs to havestructural strength against wind pressure resistance that surpasses
the Building Standards Act criteria.
We will also strengthen and systematically implement repairs andstorm and flood damage countermeasures, make earlycountermeasure preparations by using systems in the gathering of
information on natural disasters, and work to prevent the occurrenceof or reduce damage to facilities and stored cargo.

〇

Long
term

〇

〇

Long
term

Minor

While working with customers to implement energy-saving
measures, we will promote the deployment of Disaster-Resistantand Eco-Friendly Warehouses and Disaster-Resistant and EcoFriendly Office Buildings that have a low environmental impact aswell as upgrade existing facilities to have high-efficiency equipment.

〇

〇

Long
term

Major

In conjunction with the introduction of new technologies that enable
more efficient operations and reductions in workload, we will
promote initiatives to provide more comfortable working
environments, including reviews of workstyles.

〇

Mediumto long Medium
term〇

Increases in costs for measures such as
facility reinforcement in preparation for floodand storm surge damage〇

In the Logistics Business, reduce energy
costs by introducing EVs, switching to LED
lighting systems, highly efficient warehouse
operations, improving joint delivery/loading
rates, improving container terminal operations
and other initiatives〇

Reducing energy costs in the Real EstateBusiness through a raft of measures designed
to improve energy efficiency

Respond totransition to
low-carbon/
decarbonizedsocietyRealestateIncreasing needs for facilities with high-level
environmental performance and services with
low CO2 emissions, such as joint delivery anduse of renewable energy〇

Due to rising temperatures, there will be anincreasing need for temperature-controlled
transportation and delivery services, including
for products that previously did not requiretemperature control.

〇

In the situation where natural disasters are
becoming more severe and occurring withgreater frequency due to climate change,
there are increasing needs from customers
who say that they want to be able to maintainbusiness continuity and their supply chains.

〇

Increasing need for visualization of CO2
emissions in supply chains and for reduction
in CO2 emissions〇

Short tomedium Medium
term〇

Short tomediumterm〇

MediumMediumterm

Minor

Mediumto long Medium
term〇

MediumMediumterm

Short toMediummediumto majorterm

When constructing a new facility, we will carefully investigate the riskof natural disasters and consider locations, specifications, etc. tominimize the cost of countermeasures. In the case of existing
facilities, measures including relocation will be promoted dependingon the level of risk.
In terms of “hard” (tangible) aspects, we are expanding the introduction of
ZEV transportation and delivery vehicles such as EVs, hybrid cargo handlingequipment, and the use of renewable energy while deploying DisasterResistant and Eco-Friendly Warehouses with low environmental impact. We
will assess research and development trends in new technologies such as
biofuels and hydrogen.
On the “soft” (intangible) front, in transportation and delivery, we will bringabout cost reductions by working to improve energy efficiency through, forexample, the promotion of environmentally friendly transportation anddelivery services that do not prioritize lead times.
We will improve facility energy efficiency through the deployment of
low-environmental impact Disaster-Resistant and Eco-Friendly
Warehouses and Disaster-Resistant and Eco-Friendly Office
Buildings and the promotion of energy-saving measures, such as
the installation of and replacement by high-efficiency equipment. On
the basis of an advanced management system run by specialist
staff, improvements in energy efficiency will lead to cost reductions.
In terms of the “hard” aspects, we will actively promote low-environmental
impact Disaster-Resistant and Eco-Friendly Warehouses and DisasterResistant and Eco-Friendly Office Buildings.
On the “soft” front, we will work to increase revenue by responding tocustomer needs. This will be achieved in the Logistics Business byproposing logistics with low environmental impact—such as environmentallyfriendly transportation and delivery services, modal shift, and jointdelivery—and in the Real Estate Business through the installation andsupply of renewable energy electricity.
In addition to pharmaceuticals that are not subject to temperature
control, we will work to expand revenue by responding to customer
needs. This will be achieved by applying our pharmaceutical
distribution center storage and the low- and constant-temperaturetechnology and know-how of DP-Cool, which is a pharmaceuticaltransportation and delivery service, to the transportation and deliveryof products other than pharmaceuticals.
We are actively working to deploy Disaster-Resistant and Eco-Friendly
Warehouses and Disaster-Resistant and Eco-Friendly Office Buildings,
which are equipped with a range of business continuity functions. We
will heighten the safety of facilities through the systematic
implementation and reinforcement of facility repairs and wind and flood
damage countermeasures. By leveraging its know-how in selecting
alternative routes and handling facilities to provide robust logistics
services in the event of a disaster, the Company also aims to expand
revenue by responding to customer needs.
By proactively proceeding with system development, we will expand
CO2 emission visualization services. We also aim to expand revenue
by developing and providing solutions to customers to reduce their
CO2 emissions, such as by proposing logistics bases andtransportation routes.

*1 Short-term: Estimated to commence within three years; Medium-term: Estimated to commence around 2030; Long-term: Estimated to commence around 2050.
*2 Quantitative items: Less than ¥100 million is classed as minor; less than ¥1.0 billion medium, ¥1.0 billion or more major. Qualitative items: Comprehensive judgments basedon quantitative items, etc.

Mitsubishi Logistics Integrated Report 2023

37

Initiatives for Each of the Six Key Themes

Cutting-Edge Technology, Innovation
We provide advanced quality control and high value-added
services through collaboration between employees who
support society and cutting-edge technologies
By promoting the improved efficiency and sophistication of logistics
operations and facility management and supporting people active at
logistics sites, we will work to resolve social issues such as labor
shortages and contribute to the development of society and businessboth domestically and internationally.

Priority Measures and Measures through Business Activities
Improve the efficiency and sophistication of logistics operations and facility management● Achieve highly efficient operations through collaboration between labor-saving technologies, such as robotics, andhuman beings● Collect and analyze data collected in-house and data provided by customers and business partners, etc., as big
data, and add the expertise we have gained to date to realize the automation and optimization of businessdecisions through AI, business process automation and labor saving, and the increased value of services, etc.
Develop logistics platform services● Build a logistics platform utilizing blockchains and other digital technologies to achieve the visualization ofcomprehensive supply chains and advanced quality control, thereby contributing to solving customer issues● At the same time, promote the visualization and reduction of CO2 emissions to contribute to customers’
decarbonization efforts

Performance Indicators and Targets

Fiscal 2022 Topics and Initiatives from Fiscal 2023 Onwards

DX, IT-related investment amount Aiming to improve the efficiency and sophistication of logistics operations,Target values for FY2030

Cumulative investment of ¥50.0
billion for FY2021-FY2030
Investment in reformation of services and business models
based on the needs of customers and society using data anddigital technology, and transformation of operations,organizations, processes, and corporate culture/climate

38

Mitsubishi Logistics Integrated Report 2023

we have formulated standard work flows and DX measures that utilize
advanced technology for each priority area. We have implemented initiatives
to achieve highly efficient operations through cooperation between
technology and personnel, including demonstration experiments ofautomatic forklifts, introduction of an image inspection system, andoptimization of personnel allocation using AI. We have also expanded thefunctionality of our ML Chain pharmaceutical logistics platform, which began
operations in January 2022, and expanded the scope of its application tomultiple customers.
To accelerate DX promotion, in fiscal 2023 we plan to establish model
warehouses for each priority field and prioritize the introduction of solutions
suited to the characteristics of each field. Additionally, we will further
strengthen the functionality of ML Chain, thereby assisting supply chain
visualization and contributing to advanced quality control. Furthermore, wewill collaborate with start-up companies, invest in venture capital, participate
in acceleration programs, etc., and use the knowledge and technology
gained through these efforts to develop new businesses.
Additionally, we will implement the MLC Innovation Program with the aimof increasing the corporate value of our Group.
We will solicit free new business ideas from all employees, and those withpromising ideas will be transferred to the departments that handle businessdevelopment. We aim to realize new businesses through a training andresearch and development period totaling one year.
In the years to come, we will leverage internal and external knowledge
and technologies to improve productivity and increase the sophistication of
our services.

Toward solving social issues through business
The Company promotes the introduction of new technologies that support people’s work, finding solutions to labor
shortages in logistics and alleviating the burden on workers in the field. This in turn fosters a spirit that welcomeschallenges and leads to job satisfaction. The introduction of the GEEK shelf-transport robot, as seen in one of thecase studies, minimizes worker operations and allows for the receipt and shipment of small quantities of multiplelot products, enabling the Company to respond flexibly and without delay to fluctuating product volumes.
We introduced heavy-duty picking equipment at the Misato No. 1 Office in Saitama Prefecture.
This has enabled picking and inspection operations, which had been conducted in separate
processes, to be performed simultaneously, thereby substantially improving on the number ofmanhours required by onsite workers. After having finished their duties, workers can assist others
by providing support with their tasks, and through DX, we address the issue of manpower
shortages in logistics by promoting enhanced efficiency and productivity.

Main initiatives are as below.
Main initiative 1

The Company earned a place on “Noteworthy DX Companies 2023” in Digital
Transformation Stocks (DX Stocks) 2023, which are jointly selected by the Ministryof Economy, Trade and Industry (METI) and the Tokyo Stock Exchange (TSE).
Main initiative 2

Main initiative 3

Increase efficiency and sophistication oflogistics operations and facility management“ML Chain,” a logistics data platform for pharmaceuticals• Introduction of digital technology (AGVs,
automated forklifts, shelf-transport robots)
optimized for logistics sites• Use of robots to achieve streamlined
operations and optimized number of
personnel• Making use of AI to optimize distribution ofcargo and personnel• Flexibly adapting to fluctuations caused byseasonality, etc.

• Realizing sophisticated advanced pharmaceutical quality control• Maintaining a stable supply of pharmaceuticals• Expanding the scope of visualization of international logistics, etc.
• Utilizing for optimization of pharmaceutical inventory levels• Support for establishment of new distribution schemes, such as direct delivery to patients’ homes• Automation of business processes • Labor saving and reduced workload
Applied visualization

Aggregation of various information

Planned visualization
application
Pharmaceuticalwholesalers

Pharmaceutical makers

Location information

Hospitals/
pharmacies

Patients

Distribution centers
Temperature information

Inventory information

Image of robot introduced at warehouse(SharE Center misato)

By achieving visualization across the entire supply chain, our aim
is to realize a high degree of pharmaceutical product quality
assurance and sustainable logistics.

VOICE

DX promotion through data analysis
As one of our DX initiatives, to promote supply chain visualization and streamlining, we constructed adata analysis platform (a group of systems centered on a database that performs large-scalecalculations) that will visualize WMS and other data. This will allow us to easily provide suggestions forinventory management, etc. to the representatives of existing customers. Some offices have begun
using the system to visualize the number of inventory days and past inventory control status.
For new customers, we support proposal-based sales activities by providing trial calculations offreight rates, which logistics companies set in a complicated manner, and help to analyze the optimal
location of their bases. By consolidating the knowledge gained from our analyses to date anddeveloping applications for simple calculations, we aim to make it possible to offer optimal logistics
proposals to as many companies as possible.
With a view to the future, we will investigate the construction of an MLOps (machine learning
operations) environment that enables not only visualization but also the development and operation ofmachine learning, such as workload forecasting based on cargo volume forecasts and anomaly
detection in inspections. Our sights are set on improving operational efficiency and added value.

Hirotomo Hamano
Digital Transformation Team,
Information Systems Div.

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Initiatives for Each of the Six Key Themes

Partnerships
With an eye toward building a sustainable society, we
are working shoulder-to-shoulder with our partners todevelop new businesses at the forefront of industry.
Based on our unwavering sense of mission and integrity as essential
members of the economy, we will create the pillars of business that solve
social issues and improve profitability through open innovation, driven
by CVC and M&A.

Priority Measures and Measures through Business Activities

Fiscal 2022 Topics and Initiatives from Fiscal 2023 Onwards

Collaborate with startups andcompanies in other industries●	
Optimize development and create new
businesses through open innovation with
CVC, etc.

In fiscal 2022, in anticipation of the synergies to be gained on new
business creation and streamlined operations, we directly invested in
two companies, in Rapyuta Robotics Co., Ltd. for verification testingof the automated forklift business and collaboration to enhanceflexibility with complex warehouse operations, and in TradeWaltz Inc.,
which operates a platform business to digitize trading practices.
We invested in a fund that aims to support companies taking on
the challenge of transforming the real estate and logistics industries(BizTech Fund*). Through this investment, we seconded employees
to the Fund to develop human resources with expertise in investingin startup companies.

Performance Indicators and Targets

CVC* fund’s managed amount
Target values for FY2030

Establish a CVC of ¥5.0 billion* An abbreviation for “Corporate Venture Capital.” A business practicein which companies form funds with their own corporate capital toinvest in and support unlisted startups that may be related to theirbusiness or be advantageous for their core business in the future.

* The abbreviated name of Mercuria BizTech Investment LLP, formed by Mercuria Investment Co.,
Ltd. and ITOCHU Corporation.

In fiscal 2023, we made a new direct investment in Hacobu Co.,
Ltd. with the aim of improving the efficiency of transportation anddelivery operations and visualizing and reducing CO2 emissions in
anticipation of the 2024 issues*. This investment will enable us towork more closely as we aim to resolve such issues and to develop
new business areas.
We also formed a CVC with a capitalization of 5 billion yen, andalong with that, formed MLC Ventures, Ltd. In addition to creating
new businesses and reforming business models in
the logistics and real estate business areas, we will
accelerate investment and collaboration in startups
this fiscal year with the aim of developing new
businesses in peripheral areas.
* A generic term for the various problems that will arise because of the Workplace Reform Law
limiting annual overtime to 960 hours for “driving work” from April 1, 2024.

VOICE

CVC fund composition
MLC Ventures, Ltd. manages and operates MLC Innovation No. 1 Investment Limited Partnership, a
corporate venture capital (CVC) fund, with its co-partner Yui Capital Partners Co., Ltd. I was seconded
to an outside venture capital firm to acquire investment know-how and insights, and subsequently
established the company and created the CVC fund.
Operations began in June 2023, initially investing in startups that generate business synergies, with afocus on logistics and real estate. In addition, we will invest in other areas that will help solve social
issues, such as environmental measures and SDGs compliance. In the future, we aim to create thepillars of our future business, cultivate new customers, and improve the quality and profitability ofexisting operations.

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Mitsubishi Logistics Integrated Report 2023

Yasufumi Shimizu
MLC Ventures, Ltd.

Human Resource Development, Employee Satisfaction
We will provide customer-oriented, highly value-added,
quality services by promoting growth and enhancing
the engagement of our people, who are the source ofour value creation.
The Company, which has a history of 137 years woven together by thepower of its people, strives to develop global talent to pave the way forthe next era, while focusing on establishing a positive work environmentand building personnel and training systems.

Priority measures and measures through business activities
Develop personnel and welfare programs thatvalue each individual employee● Establish a personnel system that accommodates
a variety of workstyles● Create an environment that helps balance work and life

Develop human resources with global perspectives● Develop human resources with global perspectives
through expansion of training programs, etc.

Performance Indicators and Targets

Fiscal 2022 Topics and Initiatives from Fiscal 2023 Onwards

 atio of regional general employees●❶R❶ Establish a personnel system that accommodates a variety
of workstyles.
The Company strives to improve worksite environments in which
every employee can fully demonstrate his/her individuality andcompetence.
● Regional system for general employees
In order to achieve the MLC2030 Vision, it is necessary to encourage
the active participation of employees more than ever, which requires
strategic human resource development and human resource allocation.
As a characteristic of the Company’s Logistics Business, maintaining
the certainty and quality of operations at each office, which are ourlogistics sites, forms the basis of the services we provide to ourcustomers, and the stable allocation of employees who have theexperience and knowledge of those operations is essential.
In recent years, in view of the fact that there have been cases wheregeneral employees are unable to accept transfers due to family
circumstances, etc., and it is difficult for them to carry out their duties
without limiting the areas in which they work, we have established two
types of general employees: “general employees (no limits on workplaceregions)” and “regional general employees (limits on workplace regions)”
whose aim is to strengthen the on-site and sales capabilities in eachregion, in order to secure and develop future management personnel
and ensure a work system that is more suitable for employees todemonstrate their abilities. Although screening is necessary, the systemallows employees to switch between these categories in accordancewith their personal circumstances. As such, we expect it to contribute to
an improvement in employee satisfaction.
General employees have the opportunity to convert to regional generalemployees once a year when the Company allows job categorychanges. In the future, we also expect cases where an employee who
once became a regional general employee due to family or othercircumstances would convert back to a general employee position upon
the resolution of such circumstances.
The Company also actively recruits both new graduates and midcareer resources for regional general employee positions.

Target values for FY2030

Ratio of regional generalemployees 30%General employment for limited workplace regions introduced in April
2021 for realizing diverse and flexible workstyles

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Initiatives for Each of the Six Key Themes

Performance indicators and targets

Fiscal 2022 Topics and Initiatives from Fiscal 2023 Onwards

 atio of employees taking child-care leave●❷R❷ Develop personnel and welfare programs that value eachindividual employee● Uptake of childcare leave by male employees
To help raise next-generation children and encourage female
empowerment, we believe it is important not only to meet our target
for the ratio of female managers, but also to promote the uptake ofchildcare leave. In addition to spreading awareness of the Amended
Childcare and Family Care Leave Act, the Company checks theintent of those employees eligible for leave of absence and alsooffers diversity management training to managers. By doing so, we
seek to make progress in ensuring a fulfilling work-life balance for our
employees.

Target values for FY2030

Ratio of employees taking
child-care leave 60%

System that allows male and female workers who are raising a childunder the age of 2 to apply to take leave for child-care until the childreaches the age of 2

VOICETaking paternity leave
A new paternity leave system (childcare leave after childbirth) to promote the uptake of childcare leaveby men was introduced in October 2022, in tandem with the law amendment. I took advantage of thisand took a four-week paternity leave when my second and third children, twins, were born.
Based on my experience caring for my first son, I originally had a vague idea that I would somehow
manage. However, every day turned out to be more physically demanding than I had imagined as I
became so busy preparing milk for the twins and changing their diapers while taking care of myfirstborn, who still needed a lot of attention. Still, as a result of devoting my time to housework andchildcare and effectively sharing tasks with my wife, I became competent enough to take care of mychildren on my own. I am now able to give some time off to my wife, who tends to be overburdenedwith housework and childcare.
At the same time, I had the valuable opportunity to experience our children’s growth firsthand. I amvery grateful to my colleagues at work for supporting my childcare leave.

●❸ Ratio of employees with experiencein overseas assignments
Target values for FY2030

Ratio of employees with experience25%
in overseas assignments General employees with experience in overseas assignments (including
training programs)

Takayuki Masuda
Legal & Stock
SectionGeneral Affairs Div.

❸ Develop human resources with global perspectives
The Company actively seeks to develop personnel with global
perspectives by providing overseas work experience. For this, wehave stepped up our overseas dispatch program targeting young
employees. From FY2023, we have decided to increase the numberof employees being dispatched. We also plan to have some of these
employees gain experience not only in the logistics business but also
business administration at certain companies on the receiving end.
For employees who have yet to reach the years of service eligible
for the dispatch program, we provide global mindset training as partof their level-specific training sessions so that they become
motivated to apply for the training.

VOICE

Participating in the overseas dispatch program for young employees
Through this program, I worked at Mitsubishi Logistics Europe B.V., engaging in operations associatedwith international transportation. Being tasked with making logistics service proposals in Europe, I wasable to gain a lot of new knowledge. I was also required to understand the regulations in countries
outside of Europe, where the business counterparts of our European corporate customer were located.
This made me keenly aware of the importance of working with extensive knowledge of internationaltransportation. Many of my experiences there were ones I would not have gained through my work inJapan alone, so participating in this program was an extremely valuable opportunity for me.
I intend to make use of the experience and knowledge I obtained through this program to tackle theresolution of customer issues from various perspectives. At the same time, I hope to apply them topursue personal growth.

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Mitsubishi Logistics Integrated Report 2023

Yurika Tachibanaki
Sakurajima No. 2
OfficeOsaka BranchBasic principle underlying personnel affairs
The Company’s basic principle for personnel affairs is to support employees’ growth and enrichment of their workand family lives while making full use of the resulting sustainable progress of the Company to achieve mutual valueenhancement between the employees and the Company.

To realize this principle, we seek to improve employee job
satisfaction and ease of working through the introductionof various personnel and educational systems, thereby
creating an environment where our employees candemonstrate their individuality and competence to thefullest. We believe that promoting human capital-oriented
management leads to improvement of the value-added
services we provide. Furthermore, while we do nottolerate any bullying or harassment, to handle thesituation should such incidents occur, we have in place
an in-house whistleblowing hotline that ensuresconfidentiality. As a preventive measure, all managers arealso required to take anti-harassment training.
For personnel systems, we have introduced childcare
leave, reduced working hours, nursing care leave, andgeneral care leave to further bolster work-life balance
toward raising next-generation children.

Initiatives toward employee job satisfaction and growth
To strengthen the Group management base, we will strive to improve employee satisfaction, ensure diversity ofhuman resources, foster personnel with global perspectives, address work style reforms, and develop digital talent,
thereby enhancing engagement.

Conducting an engagement survey

Improving engagement

The Company has upheld the improvement of employee
satisfaction as an initiative under one of the basic policies
of its Management Plan (2022–2024), “5. Strengthen theGroup management base.” To put this initiative in motion,in November 2022, an engagement survey was
conducted at the Company and its domestic
consolidated subsidiaries for the first time.
The overall score of affirmative replies in the survey was
45.3%, and an analysis of the results showed that “young
employees’ sense of fulfillment from work” and “female
empowerment” were priority issues. In FY2023, we willseek to improve employee engagement by tackling theseissues.

We will drive efforts to create an environment where each
employee can feel at ease and have a sense of fulfillment
from work.
● Hosting town hall meetings
From July 2023, the President and other officers havebeen visiting the sales offices nationwide to hold face-toface town hall meetings.

Engagement survey results (ratio of replies)
Affirmative
45.3%

Neutral36.4%

Negative
18.3%

Purpose of the meetings• To encourage each employee to share themanagement perspective and develop a sense ofownership in taking on initiatives by having thePresident communicate the Company’s management
and sustainability issues directly.
• To draw insights for future management policies bylistening to the ideas, proposals, and opinions on
initiatives from a wide range of employees, regardlessof gender or age.

At the first meeting, the participants engaged in active
discussions based on a questionnaire distributed inadvance. Among thespecific issues covered
were the setting of goals
for the future,collaboration withexternal partners, theintroduction of EV
trucks, and going
paperless.

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Initiatives for Each of the Six Key Themes● Job satisfaction for young employees
In light of the engagement survey results, to boost our
young employees’ sense of fulfillment from work, we willpress on with initiatives for self-driven career developmentthat allow the young employees to envision their career
paths with hope for the future. Additionally, we will work
to elevate the skills of the managers to practice optimal
management so that young employees can demonstrate
their individuality and competence to the fullest.
We will also seek to foster a mindset in which theyoung employees can take pride in their work as essential
workers. For this, we will effectively disseminate ourcorporate philosophy, the MLC2030 Vision, and theMedium-Term Management Plan and encourage theyoung employees to acknowledge once again the
Company’s raison d’être, direction, and the social
significance of their work.

Working to enrich the lives of our employees andtheir families by expanding welfare programs
Based on the three key concepts of “providing peace ofmind,” “recreation,” and “promoting home acquisition,”
the Company offers various programs aimed at enhancing
employee benefits.
Main welfare programs
1. Providing peace of mind:
Retirement benefits, corporate pension, family
allowance, housing allowance, condolence money,
money gift for childbirth, stock ownership plan, groupinsurance, pension savings plan, multi-purpose loans,
corporate housing for transferees
2. Recreation:
Company-owned recreational facilities, in-house
sports tournament (baseball, tennis, and futsal),martial arts tournament of the Mitsubishi affiliatedcompanies, special incentive vacation (for longtenured employees and mid-level employees)
3. Promoting home acquisition:
Savings plan for housing, in-house loans, loans fromaffiliated parties

Seeking to further improve work-life balance forraising next-generation children, and other purposesWith the Act on Advancement of Measures to Support
Raising Next-Generation Children taking effect, theCompany has formulated an action plan to help
employees balance their work and family lives.
Accordingly, we introduced several systems, includingchildcare leave, reduced working hours, nursing careleave, general care leave (paid), and family care leave(paid). In addition, we introduced a system to grant paid
leave systematically (six days per year) under thecooperation of labor and management to actively
promote the uptake of annual paid leave and reduce
annual working hours.

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Mitsubishi Logistics Integrated Report 2023

Creation of an environment that supports
the balancing of work and family life
● Questionnaire survey on childcare leave
We conducted an in-house questionnaire survey onchildcare leave with a view to creating an environment
where employees can feelat ease taking the leave.
Using the questionnaire
results as a reference, weplan to revise thepersonnel system andconduct in-house training
to promote the uptake ofchildcare leave.
● Childcare leave handbook
We will create an in-house handbook featuring information
on internal systems useful for child-rearing and stories
from male and female employees who have taken
childcare leave. We hope to support the diverse work
styles of employees by providing this handbook as asource of reference.
● Introduction of a “comeback” system
The “comeback” system was introduced to promote thereemployment of former employees. Under this system,
we expect employees who left the Company due toreasons such as childcare, nursing care, and spouses’
office transfers to return as work-ready resources once
these reasons have been resolved. With the recent
diversification of work styles, especially among young
people, we also hope to see new perspectives brought
into the Company by rehiring employees who havegained experience and honed their skills through jobchanges to other companies.

Implementing occupational safety and healthmeasures to maintain and improve employee health
To faithfully fulfill the duty to care for employee safety as acompany, we proactively implement measures to maintainand improve employee health.
● Periodic health checkup
We conduct periodic health checkup once a year, working
to expand the number of test items for lifestyle diseases,
among other initiatives. In recent years, long working
hours have become a social issue. To prevent healthdamage due to overwork, we have a system in place tothoroughly provide those employees working long hours
with guidance based on interviews with industrial
physicians.

Working on mental healthcare initiatives focusing
on prevention and avoidance of recurrence
We place utmost importance on caring for the mental
health of our employees in an organized and continuous
manner so that each employee can work vibrantly at theCompany.
In accordance with the Guideline for Maintenance andPromotion of Mental Health of Workers set forth by the
Ministry of Health, Labour and Welfare, the Company has
implemented various initiatives aimed at mental
healthcare. For instance, we have worked to enhancein-house education and training, develop persons incharge to be placed at the worksites, introduce a stresscheck program based on the Industrial Safety and Health
Act, and bolster our network through partnerships withoutside specialist organizations.

Policy and efforts on health and safety●	Initiatives undertaken by the Overland Transportation● Our policy and stance
As a fundamental premise for practicing sincere and faircorporate activities, the Group prioritizes the safety andhealth of its employees and all people involved in its
business operations. Based on this understanding, we
will strengthen the group-wide safety management
system for the above stakeholders and promote efforts
toward occupational safety and health at each businessdivision and office.
●	Efforts to strengthen the group-wide safety
management system
The Safety Promotion Section within the Personnel
Division engages in efforts to prevent occupational
accidents at the Company and other companies
entrusted with operations, as well as to raise employee
safety awareness. The section has built a system toreport accidents involving personal injury so that
information can be delivered to the management promptly
in the event such accidents occur. Additionally, thesection uses the safety promotion bulletin board todisseminate to each logistics site various information on
accidents and occupational safety and health, statistics
and analyses on accidents, and other information usefulfor accident prevention. By doing so, it endeavors toelevate safety awareness across the Company. Moving
forward, the Safety Promotion Section will collaborate
with other business units to further promote initiatives forgroup-wide prevention of occupational accidents,
including the introduction of safety measures that utilize
advanced technology.
● Working toward prevention of occupational accidents
The offices collaborate with each other in their efforts toensure occupational safety and health. Each branch holds
Health and Safety Committee (referred to as the HealthCommittee at the head office) or Health and Safety
Council meetings to provide an opportunity for individual
offices to share information on occupational safety andhealth initiatives. Such offices include those of companies
to which we outsource cargo handling and otheroperations. Additionally, by offering safety and healtheducation at each office and conducting safety patrols
within and outside the facilities, we make every effort toprevent occupational accidents with the aim of reducing
their number to zero.
●	Initiatives undertaken by the Warehousing andDistribution Business Division
The Warehousing and Distribution Business Division
works to prevent accidents by promoting safety patrols,
among other measures. Each sales office of the division(including some offices of the International Transportation
Business Division) conducts safety patrols. During thesepatrols, employees of the Company and the companies
entrusted with operations make the rounds at thewarehouse sites to check the facilities and the conditionsof cargo storage while being attentive to preventing
COVID-19 infections. Depending on the results of thesechecks, meetings are held to implement accident
prevention measures so that the safety of the employees
and cargo is maintained.

Business Division
Ryoso Transportation Co., Ltd. understands that securingcargo transportation safety is the cornerstone of its
business operations. Accordingly, all its employees work
as one to secure safety by placing the highest priority on
improving transportation safety. Furthermore, Ryoso
Transportation conducts internal audits on compliancewith the Motortruck Transportation Business Act, and theRoad Traffic Act, etc. to spread awareness and promotethorough adherence to related laws and ordinances. At
the same time, it consistently inspects the safety of the
cargo transportation business in full recognition of the
public nature and significance of the services being
offered. Daily activities aimed at preventing accidents
include holding safety meetings, conducting safety
patrols, holding all-branch meetings of sales
representatives, and thoroughly practicing the use ofhigh-performance alcohol detectors during roll calls at all
vehicle-dispatch bases. Additionally, Ryoso Transportation
makes effort to ensure occupational safety and health byconducting periodic health checkups that include test
items for lifestyle diseases and by providing guidance andeducation to drivers based on the results of periodic
driving aptitude tests.
●	Initiatives undertaken by the Port and Harbor
Transportation Business Division
The receipt and delivery of various types of cargo at ports
and harbors call for a wide variety of cargo handling
operations. To conduct these operations safely andsmoothly, each worksite implements diverse initiatives
based on the measures formulated specifically for eachsite. Additionally, case studies of occupational and cargo
accidents are presented for review at daily morning
meetings and monthly safety and health meetings withbusiness partners to raise awareness and consolidate thestance of the workers regarding safety and health. As an
example of its effort to address the rapidly changing
worksite environment, the Port and Harbor Transportation
Business Division reviews the format of the safety patrols
conducted regularly, boosting the inspection menu while
paying attention to the prevention of COVID-19 infections.
In this way, it seeks to grasp the situation and improve
the worksite environment. It believes that safety and theprevention of occupational accidents result from theefforts to constantly search for new ways to improvesafety and health, while actively engaging in conventionalsafety promotion activities and not neglecting daily
activities that drive motivation. Specific initiatives also
include participation in outside seminars and training
sessions.
In FY2022, there were 11 occupational accidents*1 at
the Company.
We will make every effort to reduce the number of such
accidents by continuing to work on ensuring employee
safety and health.
*1 Scope: All workers of the Company and its domestic consolidated subsidiaries(including dispatched workers and workers seconded to Mitsubishi Logistics).
Excludes employees seconded to other companies, etc.

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Initiatives for Each of the Six Key Themes
Appropriate working environment
An appropriate working environment stabilizes one’s standard of living, gives purpose to life, and is indispensable toproductivity improvement and the development of human resources. For this, we will focus on the labor-management
relationship, strive to prevent overwork, and take on initiatives, being fully aware that ensuring worker safety anddeveloping and training human resources are among the issues that need to be addressed.

Focus on labor-management relationship
The Company values communication with the labor union.
The labor agreement concluded between the Company
and the Mitsubishi Logistics Labor Union is grounded incooperation between labor and management and defines
the responsibilities of the Company and those of theunion as follows.
1. Responsibility of the Company
The Company shall make active efforts to maintainand improve working conditions and enhance thewelfare of its employees to improve their status andprovide them with a stable life.
2. Responsibility of the union
The union shall strive to maintain order in theworkplace, promote improvement of work
capabilities, and cooperate fully in the Company’sbusiness development founded on democratic
principles.

Discussions and negotiations between the Company
and the union are conducted at the management council
meetings attended by the representatives of both parties.
These meetings break down into the Central
Management Council meetings involving the Company’s
main office and the union headquarters and the Worksite
Management Council meetings involving the branches
and the union branches. Both types of meetings are held
once a month.

Prevention of overwork
The Group strictly abides by the labor laws andregulations of each country and seeks to reduce overwork
through stringent management of work hours. As specificmeasures, we have a system in place where we canconstantly monitor the check-in and check-out times ofour employees and the work hours they enter into theattendance management system, along with the status ofmonthly overtime. We also use computer log data toverify whether work hours are entered correctly. To
transform the mindset of managers, we hold manager
briefings aimed at reducing overtime work and endeavor
to have the measure take root by holding workplacemeetings for the employees, among other means.
Additionally, at the meetings of the management
council and the work hour improvement committee, theCompany and the union periodically check the status ofovertime work and the uptake of leave of absence. In thisway, they share information on effective initiatives toreduce work hours.

Stance on employment
As a basic policy, the Company respects diversity regarding race, religion, gender, age, physical disability, sexual
orientation, and nationality, when hiring employees.

46

Recruitment activities

Employment of elderly individuals

To secure human resources from a long-term perspective
and in a systematic and stable manner, the Company has
introduced an open entry system, which does not place apreferential weighting on certain schools or faculties. We
are fully committed to ensuring fair and impartial
screening of applicants.
We disseminate recruitment information using our
website andvarious othermedia and offer
opportunities to awide range ofapplicants,
including thosewith specialized
knowledge andwork experience.

Even before the introduction of a law to promote theemployment of elderly individuals, the Company worked
to secure employment up to the age of 62 or 63 throughseveral measures. These included finding work forretirement-age employees at affiliated companies andrehiring those with specialized knowledge. With the law
taking effect, we currently have a continuous employment
system in place where employees who wish to continue
working can do so until age 65 based on certain
standards. Roughly 90% of retirement-age employees
continue to work under this system. Amid the declining
birthrate and aging population, we will continue to provide
employment opportunities to elderly individuals and offer
retirement-age employees, who are highly motivated todemonstrate their abilities, a place where they can thrive
as work-ready resources.

Mitsubishi Logistics Integrated Report 2023

Initiatives for employee growth
We improve the personnel system and expand the training programs to foster human resources who can contributeto the development of society through our business operations.

Improving the personnel system to create aworkplace where employees can demonstrate
their individuality and competence
The Company strives to create an environment in which
employees can engage in their work with strong
motivation and fully exhibit their individuality andcompetence.
● Concept image of ideal human resources
With the “Code of Conduct” in mind, every employee
aims to undertake a role not only in corporate growth but
also in the development of society by conducting himself/
herself in the following manner
1. Keep faith in others, and conduct yourself withintegrity and a sense of fairness.
2. Conduct yourself autonomously.
3. Respond flexibly to environmental changes.
4. Demonstrate expertise and act with a sense ofcreativity.
5. Have a good teamwork spirit and cooperate withyour colleagues.
● Self-reporting system
Under the self-reporting system, employees are asked
once a year to report the level of satisfaction with theircurrent job assignment and to present their career plans.
The report form not only comprises items regarding job
assignments but also covers items pertaining to the life
plans of individual employees. The reported content isutilized in deciding personnel transfers and designingcareer paths, among other purposes.
● Employee evaluation and treatment
The Company determines the treatment of employees
based on an evaluation system that is fair, transparent,
and compelling. We particularly place importance on themeetings between employees and their supervisors held
three times a year (at the time of setting goals, for midyear review, and for year-end review). These meetings
serve to deepen communication and are useful inproviding employees with appropriate advice on work
assignments and career plan development.

● Training system

The Company focuses on developing human resourcesthat can precisely respond to internal and external needs.
The Company therefore strives to upgrade employees’
business skills and the organization’s strength throughtraining by service year of employment. At the same time,
the Company offers several training programs to raise
employees’ expertise such as management capabilities,
readiness for globalization and operational capability toenable employees to acquire professional skills in
response to the content of their business duties.
We conducted a review to expand the overseas
dispatch program, examined the framework of the new
system, and identified issues for its introduction.
● Initiatives to improve DX and IT literacy
To improve operational processes and promote theutilization of new technologies as outlined in MLC2030
Vision, the Company introduced a program to foster DX
talent. This program entails basic training and practicaltraining through workshops, etc., held in-house andoutside the Company. Its purpose is to foster humanresources who can drive the DX efforts at each
workplace.
We also continued to further expand and promote theusage of RPA by, for instance, regularly offering training
sessions to foster in-house RPA developers andestablishing a system to award the development of robots
that have been adopted in actual operations.

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Initiatives for Each of the Six Key Themes
Human resource development (training) structure
The Company works to foster human resources who can contribute to the development of society as essential workers.
● Programs for developing general employees and regional general employees
Basic roles
General employee: engages in a wide range of business operations at various locations, including overseas, as a core employee;
also bears responsibility for business growth and management
Regional general employee: engages in a wide range of business operations, mainly in a specific geographic region; also bears
responsibility for business growth and management
GlobalLife
planning
seminarTraining for new managers

Theme-based management training(action learning to improve perspectives, acquisition of basic management skills)

Leader training(problem-solving, followership, career design, etc.)

Young employees

Second-year training (logical thinking, global mindset,
safety and health, etc. [some take the logistics training course])
1H new hire training/2H new hire training(business etiquette, basic knowledge on the Company’s businesses, worksite visits, etc.)

Overseas dispatch
program for young
employees

1

Practical training on business model formulation

Overseas business workshop *2(leadership [mandatory], labor management [mandatory],
accounting [mandatory], problem-solving, coaching)

Logistics training *Area general employee

Deputy manager level

Mitsubishi marketing
workshopPractical training
on problem-solving

Correspondence course

Deputy GM
training(understanding of management skills, corporate ethics, etc.)

Mid-level employees

Cross-

SelfWellindustry
being development interaction

Management
strategy

Senior management level

Manager level

Corporateethics/ ESG/SDGs Management Logistics
compliance

CareerdesignProblem-solving Human skills

Health promotion seminar

General employee

Career stage● Programs for developing regional employees

Basic roles Exclusively handles business operations of a particular division in a given geographical region; has a deep understandingof the business traits, is well-versed in the operations, and bears the responsibility of supporting business growth
Career design

Corporate ethics/
compliance

ESG/SDGs

Logistics

Life planningseminarSenior leader level

Regional manager training

Mid-level regional employee training(discovery of own strengths and weaknesses, improvement of communication skills)

Mid-level employees

Young regional employee training(problem-solving, career design, etc.)

Logistics training *1

Leader levelOverseas business workshop *2(confirmation of role and expectation, leadership)Well-being

Selfdevelopment

Correspondence course

Human skills

Health promotion seminar

Career stage

Second-year training(CSR, safety and health, etc. [some take the logistics training course])

Young employees

1H new hire training/2H new hire training(business etiquette, basic knowledge on the Company’s businesses, worksite visits, etc.)
*1

*2

48

Main courses offered in logistics training● Registered customs specialist qualification course● Fuji Logistics Kaizen System (FKS)● Safety and health course● Warehousing Business Act and contracting practice● Course on laws and practices regarding cargo transportation● Overview of warehousing practices● Marketing in the service industry● Sales activities in the warehousing business● Overview of the Port and Harbor Transportation Business● Overview of the Company’s information system and information system trends in the logistics industry● Case study course, other
Main courses offered in the overseas business workshop● Bill of lading and NVO operations● Import marine cargo handling● Export marine cargo handling● Overseas logistics proposals, other

Mitsubishi Logistics Integrated Report 2023

Compliance, Human Rights, Gender
In line with our Code of Conduct based on the spirit of the Three
Principles of Mitsubishi’s Business Management Philosophy, we willthoroughly exercise compliance and the observance of human rights tobecome a company that continues to be chosen by the customers.
The Company will lead the way in ensuring strict compliance throughout
entire supply chains. We will also focus on respect for human rights andthe promotion of female empowerment, with the aim of building adiverse organization.

Priority measures and measures through business activities

Fiscal 2022 Topics and Initiatives from Fiscal 2023 Onwards

Promote sincere and fair business activities
Ensure thorough compliance, withawareness of comprehensive supply chains● Implement initiatives for adherence
to relevant laws and regulations
and respect for human rights
together with subcontractors
Promote female empowerment● Build a system and create anenvironment where female
employees can thrive❶ Regarding the FY2022 surveys, we conducted the Code of Conduct
questionnaire survey after updating its content to raise complianceawareness within the Group. For the sustainability questionnaire, we added
questions referring to the human rights policy and conducted the survey
with the participation of approximately 60 subcontractors. In June 2023, we
also conducted the survey with overseas subcontractors.
	  The response rate for both the Code of Conduct questionnaire and thesustainability questionnaire exceeded 90%, surpassing the targets we set.
	  In the field of compliance, moving forward, we will continue the initiatives
we implemented in FY2022, conducting the Code of Conduct questionnaire
survey within the Group and the sustainability questionnaire survey mainly
targeting our subcontractors. We will aim to achieve a response rate of 90%
for both. When conducting the surveys, we plan to review the content of
the Code of Conduct questionnaire to include compliance-related and othermaterials deemed necessary at that time. For the sustainability
questionnaire, we intend to first formulate and disclose our procurement
policy, then include its content in the survey to spread awareness. We alsoplan to expand the scope of the survey with entire supply chains in mind.

Performance Indicators and Targets

 esponse rate for Code of●❶R
Conduct questionnaire andsustainability questionnaire
Target values for fiscal 2030

Code of Conduct questionnaire andsustainability questionnaire(formerly, the CSR questionnaire) Response rate: over 90% every year
Questionnaire on sustainability targeting subcontractors,
etc., with close business relationships●❷ Ratio of female managers
Target value for fiscal 2030

Ratio of female managers:
10%
Ratio of managers among female workers❷ To promote female empowerment, we have set a new target for the ratio of
female managers. We will step up our efforts in this area by supporting theself-driven career development of our female employees.
In addition to setting a new target, in January 2023, we formulated the
Mitsubishi Logistics Group Human Rights Policy to fulfill our responsibility torespect human rights as a company. In this policy, the Group adheres to theInternational Bill of Human Rights, the Declaration on Fundamental Principles
and Rights at Work advocated by the International Labour Organization (ILO),
and the United Nations Guiding Principles on Business and Human Rights.
Accordingly, we promote respect for human rights and do not tolerate any
manner of child labor or forced labor, including human trafficking. We also
prohibit all forms of discrimination and harassment, declare our respect fordiversity (human rights, religion, gender, age, disability, nationality, etc.), andseek to become a company that can provide growth opportunities aligned withthe strengths, capabilities, and the will of individuals. This fiscal year, we
conducted diversity management training for the managers as part of ourefforts to respect diversity and individual values. We have also worked toprevent human rights violations such as forced labor and child labor by
establishing a whistleblowing system and an external consultation hotline. In
FY2022, there were no compliance violations associated with human rights
abuses.
Details of the human rights policy
HOME ▶ About us ▶ Management Policy ▶ Mitsubishi Logistics Group Human Rights Policy

As an initiative to demonstrate respect for human rights within our corporate
activities, moving forward, the Company will prepare for the implementation ofhuman rights due diligence, incorporating the opinions of external experts.
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49

Providing Customer-Oriented High-Value-Added and High-Quality Services

Quality Management/Improvement
Logistics forms part of our customer product quality,and by striving to improve quality, we aim to remain acompany that continues to be chosen by customers.
To provide high-quality services, it is important not only to introduce
cutting-edge technology, but also to carry out daily basic operations
carefully and carefully. We believe that accumulating people-centeredimprovement activities without neglecting the obvious will lead to
improvements in field strength and quality.

Engaging in quality management/improvement initiatives by customer-oriented improvements
Aiming for the heights of quality from ourcustomers’ perspectives

Linking employee satisfaction to customer
satisfaction

activities included not only reviews of the operation flowlines within warehouses, improving storage efficiency, andenhancing safety measures but also business
improvement and the streamlining of clerical work in
offices.
The administration provided support to help the activity
groups thoroughly analyze problems, identify the causes
and perform efficient improvement activities.
Despite being small-scale improvement activities, bycontinuing Group-wide efforts, the activities may produce
great results. To have the improvement activities ingrainedin our corporate culture, we will operate the system while
sharing activity examples in the Group with the use of aninternal database and in-house journal.

Believing that employee satisfaction (ES) is an essential
factor in providing customers with high-quality service, we
make great efforts to increase the motivation of each andevery employee.
We believe that creating an environment in which our
employees can work with confidence and provide
customer service with a smile will eventually lead toincreased customer satisfaction (CS).

General views of fiscal 2022 improvement activity award system review committee meeting

Conducting business based on ideas and actions fromour customers’ perspectives, we aim to achieve customer
satisfaction and also make sweeping improvements to“quality of operations,” “quality of business duties” and“quality of the Company.” Moreover, to ensure trust from
customers, we will build on our efforts at ensuring goodquality to become a corporation that can boast “quality”
as its strength.

We commend improvement activities thatwill lead to service quality improvement andthe streamlining of business processes
In July 2016, the Group introduced a commendation
system for improvement activities with an aim to vitalize
the voluntary improvement activities. Under this system,
every year an award is given to the group that particularly
contributed to service quality improvement and thestreamlining of business processes.
By continuously reviewing operational processes
through improvement activities, we will improve the qualityof our Group’s services while aiming to contribute to theimprovement of customer value adopted in the MLC2030
Vision.
In fiscal 2022, 49 groups (337 people) joined theactivities, making a cumulative total of more than 2,500
participants. Having carried out activities in accordancewith the Mitsubishi Logistics Improvement Procedures onthemes they had set themselves, the activity groups
reported their results. The content of their wide-ranging

Pharmaceutical distribution center 6S
methodology activity initiatives
Ensuring the safety of employees and thoroughly in
implementing our 6S methodology—seiri (sorting), seiton(organizing), seiso (cleaning), seiketsu (sanitizing), shitsuke(discipline), and safety—form the basis of quality control
and improvement. We believe that it is essential in quality
control and improvement to place importance on theobvious things every day and to continue to perform
improvement activities. Specific examples are as follows:●	In terms of seiso (cleaning), we clean blind areas, suchas under air-conditioning units, cargo handlingequipment, fixed shelves, and flow racks.

Cleaning under air-conditioning units

50

Mitsubishi Logistics Integrated Report 2023

Cleaning under flow racks

●	In terms of seiketsu (sanitizing), we perform maintenanceon the assets that support our customers’ products,
such as wiping away forklift tire marks, regularly repairing
floor line tapes, and inspecting the bases of flow racks.

Wiping away tire marks

Repairing floor line tapes

Logistics Thailand Co., Ltd. in March 2022, and P.T.
Mitsubishi Logistics Indonesia in April 2022—acquired
GDP*3 certification for each country and region, and as aGroup we are working to expand the business andimprove the quality of international pharmaceuticallogistics services.
*1 Formed through the collaboration of Kansai Airports and international airtransportation carriers that use Kansai International Airport (KIX) in order for eachcarrier to obtain CEIV Pharma certification with a view to ensuring the highquality of pharmaceuticals freight handling at KIX.
*2 Formed through the collaboration of Narita International Airport Corporation andinternational air transportation carriers that use Narita International Airport with aview to obtaining CEIV Pharma certification.
*3 GDP (Good Distribution Practice): quality control standards in the distribution
process of pharmaceuticals●	In terms of shitsuke (discipline), we have set up a bulletinboard for 6S activities and areworking to raise awareness ofactivities by posting
information about their stateof progress and mental
attitude. Sharing information,
including about near misscases at the center, leads toincreased awareness ofproblem solving.

●	In terms of employee safety, we are implementing thefollowing initiatives:• Evacuation routes are posted with phosphorescent tape inareas where there is a possibility of being trapped in an
emergency, such as a power outage or fire.
• If there is an obstacle that poses a high risk of contact, a
notice will be posted at the entrance stating that there is adangerous area at the back of the passageway.
• Installing upright posts in areas where people are likely to run out.
• Evacuation route maps will be posted at various locations
at the center, clearly indicating the emergency exit closest
to the reader’s current location and the locations of fire
extinguishers and fire hydrants.
• Doors serving as emergency exits are clearly marked“evacuation route” and posted to encourage smoothevacuation actions.

Working together with on-site employees who support
logistics, we strive to improve the quality of ourcustomers’ products.

Obtained CEIV Pharma certification,a quality certification system forpharmaceutical air transportation
Having participated in the KIX Pharma Community*1
operated by Kansai Airports at Kansai International Airport
and in the Narita Airport Community*2 operated by Narita
International Airport Corporation at Narita International
Airport, the Company acquired certification—under the
CEIV Pharma air transport quality certification system forpharmaceutical air transportation—for its operations at
Kansai International Airport in April 2019 and at Narita
International Airport in November 2022. CEIV Pharma
certification is a quality certification system forpharmaceutical air transportation promoted by theInternational Air Transport Association (IATA). The uniqueaspect of CEIV Pharma certification is that organizations
are certified in accordance with the same quality
inspection standards worldwide. Going forward, we willcontinue to provide high-quality pharmaceuticaltransportation.
In addition, three Group companies—Mitsubishi
Logistics Europe B.V. in December 2021, Mitsubishi

Confirming the process for bonded
operations, etc., under the AEO Program
The Authorized Warehouse Operators’ Program, one of
the AEO Systems, is a system for certifying managers ofbonded warehouses and bonded factories as authorized
warehouse operators after they meet set conditions
concerning compliance and other regulations. Theseauthorizations ensure preferential treatment such as
simplified procedures and exemptions from permit fees,
etc. and the Company received approval as an authorized
warehouse operator and further enhanced complianceactivities in customs-related processes and all otherimport/export services. In April 2016, the authorization
was renewed, and we will continue
to strive to provide highly reliableand dependable logistics services
for our customers.
Meanwhile, the Company
acquired certification as Authorized
Customs Brokers under the AEO
System in June 2017, and eachGroup company on the dates
shown in the table. An authorizedcustoms broker is a customs
clearance operator, subject tovarious preferential privileges,
Certificate of AEO Customs
which is authorized by the
Broker (The Company)
customs office to arrange forsecurity management system regarding cargo andcompanywide compliance system. The Company willfurther improve the quality of its customer service going
forward.
* Systems that provide measures that ease and simplify customs procedures forbusiness operators who have constructed cargo security management
frameworks in compliance with laws and regulations, aiming both to secure andsmoothen international logistics security, as well as to enhance Japan’sinternational competitiveness.
The policy for implementing and constructing AEO Systems is set within the SAFE
Framework of Standards to Secure and Facilitate Global Trade adopted by the
WCO (World Customs Organization). Japan’s AEO Systems comply with thatpolicy. (Source: Japan Customs website)■ Status of acquisition of certification as Authorized Customs Broker by the Group

Company nameDate of certification

Monryo Transport Corporation

September 2012

Keihin Naigai Forwarding Co., Ltd.

June 2014

Ryoyo Transportation Co., Ltd.

April 2017

Mitsubishi Logistics Corporation

June 2017

Naigai Forwarding Co., Ltd.

February 2018

Fuji Logistics Co., Ltd.

May 2018

Unitrans Ltd.

November 2019

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51

Crisis Management Countermeasures Underpinning Safety and Security

Strengthening Risk Management and Information Security
We have put in place thorough crisis management
measures to underpin safety and security so that ourcustomers can use our services with peace of mind.
We believe that strengthening crisis management and IT security isextremely important not only to support our business model but also to
deepen the trust of our stakeholders. We are strengthening our facilities
and IT systems in anticipation of emergencies, however unlikely, andpromoting employee training.

Addressing both soft and hard aspects in BCP
To fulfill our corporate social responsibility and live up to
the trust society places in us, we have stipulated a basic
policy for times when crisis management is being
enacted.
The basic purpose of our crisis management measuresis also to predict various crises that can seriously affectcorporate management, prevent such crises and, if acrisis does happen, focus on the crisis quickly andeffectively to minimize human and material damage thatwould impact corporate management and restore thenormal operational structure as early as possible.
As specific initiatives, we have adopted the concepts of“Disaster-Resistant and Eco-Friendly Warehouses” and“Disaster-Resistant and Eco-Friendly Office Buildings” inresponse to the increasing intensity of disasters and, in
terms of systems, have strengthened our all-hazard BCP
responses. We are aiming to be resilient against disasters
from both soft (intangible) and hard (tangible) aspects
and, apart from these measures, are also promoting thestrengthening of soft aspects, such as fire prevention
measures and IT security.

procedures of restoration from disaster damage, etc.
In addition, communication training on the use oftransceivers was conducted monthly in the Group
companies to acquire the knowledge of its use, in orderto strengthen the disaster measures system.
Moreover, by increasing the number of offices
implementing the Earthquake Early Warning system, we
strive to promptly collect information needed to ensure
employees’ safety.

■ Basic policy for times when crisis management is being enacted

Following the fire at a warehouse of a major mail ordercompany in February 2017, the Building Standards Act
was amended in June 2019, requiring the formulation of amaintenance plan for fire shutters at warehouses of acertain size or larger. The Company, even before thisincident, had been conducting thorough employee
education, enhancing security, and taking fire preventive
measures from the aspects of structure and facility whenconstructing warehouses. In addition, we haveestablished a constant communication system with thefire stations responsible for the locations where we areoperating and conduct periodic fire drills every year in
preparation for the occurrence of fire. Through continuingsuch measures and initiatives, we will strive to provide
highly reliable services for our customers.

To fulfill our corporate social responsibility, we intend to:
1. Ensure the safety of employees, their families andrelated people;
2. Preserve corporate facilities (e.g., the Company’s
warehouses, buildings and facilities) and the freightreceived; and3. Strive to quickly restore and continue operation.
To live up to the trust placed in our corporation by society, we will:
1. Strive to avoid adverse effects on stakeholders(customers, shareholders and business partners), and
2. Contribute to the rapid stabilization of local communities.

Reinforcing the emergency and disastermeasures system
As an emergency measure, we implemented large-scaledisaster measure training with mandatory employee
participation. In fiscal 2022, although we scaled back thetraining in view of COVID-19, the training involved the useof a mobile phone safety confirmation system, going to or
leaving a work site by walking and checking the52

Mitsubishi Logistics Integrated Report 2023

Transceiver (MCA radio)

Earthquake Early Warning System

Taking measures to prevent fire andrespond to the occurrence of fireFire prevention patrol

Fire drillWe have introduced the Disaster Information
Communication System (D-DICS)
Previously, a telephone network was to be used for
emergency communications between the leased building
management offices in the Tokyo metropolitan area andthe Company, and between those management offices
and the head office of Dia Buil-Tech Co., Ltd., our leased
building management company. However, based on theassumption that telephone lines would become
overloaded during large-scale emergencies, we
introduced the Disaster Information Communication
System (D-DICS) jointly with Dia Buil-Tech, using Internet
networks that are not prone to overloading even during
emergencies. In this way, we have ensured secure
information transfer and sharing in times of disaster.
(Started operation in September 2017, covering 23
leased buildings.)
The D-DICS system enables real-time sharing of
information on the status of damage among relevant
parties when entered into the system at each building,and can also carry instructions regarding the damage orother communications.
The introduction of this system brings about thecentralization of information, enabling a swift and accurate
initial response in times of disaster.
We will continue to work to ensure that the tenants ofour buildings can use them with confidence, through theutilization of this kind of system.

Tokyo Dia Building’s in-house fire brigade
won the title in the examination board
sponsored by a fire station
Dia Buil-Tech Co., Ltd., the management company for
the Company’s leased buildings, is working to strengthen
and enhance the disaster-prevention systemcompanywide.
Every year the company participates in a fire stationsponsored in-house firefighting examination board, whoserole is to improve the results and techniques of in-house
firefighting activities at operating bases. In 2023, theexamination board awarded the first prize in the nonspecific applications category to Tokyo Dia Building.
In the future, wewill remain committed
to giving building
owners and tenants a
sense of safety andsecurity by continuing
training sessions in
preparation fordisasters.
Tokyo Dia Building, self-defense firefighters

We are strengthening information security
to provide high-quality services that
customers can use with peace of mind
To provide the best services for our customers, theCompany formulated various rules related to information
systems. We have disseminated our information security
policy to all executives and employees. To ensure thesmooth business activities of the Company, weformulated specific compliance matters as to the use andmanagement of our in-house network. Also, we appoint a
LAN manager from each branch’s information system
section and OA promotion staff from the relevant sectionof each division that uses the network, ensuring safety
and the effective use of our in-house network. In fiscal
2022, we conducted a web-based questionnaire withregard to information security in November 2022 which
was answered by a total of 3,512 persons, including
1,825 persons from the Company and 1,687 persons
from Group companies, thereby increasing awareness of
information security. As a measure against the kind ofcyberattacks represented by targeted e-mail virus
attacks, in addition to establishing strong security defense
measures through multilayer defense, we are endeavoring
to strengthen our security by introducing software that
detects suspicious behavior on individual computers tominimize faults and recover rapidly even in the event ofunauthorized access.
Furthermore, we are increasing information security,
such as by conducting regular training and education on
cyberattacks for executives and all employees.
Management of Information Security
1.	Security of customer information (personal
information)
2. Security of intellectual property rights
3. Confidentiality obligation
4.	Compliance with laws and regulations, obligationof compliance with regulations and penalties
5. Management of information assets
6.	Formulation of security measure standards(Development standard, management standard,outsourcing standard)
7. Monitoring and supervision
8. Protecting systems from computer viruses
9. Access authority control
10. Information security education

Management of Network Security
1.	Management of connection to ML-net (In-housenetwork)
2. Rules for e-mail use
3. Rules for dispatching information
4.	Rules for connection with networks outside theCompany

Also, part of the operations of the Tokyo Branch trunk
room office, Dia Systems Corporation (our subsidiary todevelop and manage our information system) and Fuji
Logistics Co., Ltd. (our logistics subsidiary that plays acentral role in the Warehousing Business Division) all
acquired ISO 27001 certification, an international
information security management system standard, andperiodically receive third-party evaluation by a certifying
organization, thereby working to improve our information
security.

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53

Value-Creation Infrastructure

Dialogue with the Outside Directors

Outside Director

Tetsuya Shoji

Outside Director

Tatsuo Wakabayashi

The Company invites those with a wealth of knowledge and experience in their professional fields toserve as outside directors.
These outside directors provide advice and supervise management from an independent, objective
standpoint in order to ensure that the Board of Directors can engage in sufficient deliberations, aswell as make swift yet rational decisions.
For this report, we spoke with Tatsuo Wakabayashi and Tetsuya Shoji as outside directors about theirimpression of the Company, their assessment of initiatives to enhance the effectiveness of the Boardof Directors, their expectations for Hidechika Saito as the new president, and the challenges forachieving further growth, among other themes.

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Impressions of Mitsubishi Logistics and Its Sense of Values
Wakabayashi Four years have passed since I was
first appointed as an outside director. My initial
impression upon my appointment was that theCompany engaged in every aspect of its business ina serious, earnest, and conservative manner.
Although I also felt similarly about the operations of
the Board of Directors, my thoughts have changed
significantly over the past four years. Led by theoutside directors, the Board of Directors has come tovibrantly exchange a multitude of questions andopinions, and is even considering extending thelength of the meetings. But of course, the Company’s
fundamental stance of engaging in business in aserious, earnest manner has not changed in any way.
Even as working from home rapidly expanded
during the COVID-19 pandemic, I was highly
impressed that the Company continued to operate
its worksites as normal despite facing the risk ofinfection. This was thanks to the strong sense of
mission as a company responsible for essential work,
more specifically the awareness that the Company
must not shut down the worksites of a logistics andwarehousing business that formed a part of thesocial infrastructure. This clearly showed me that the
stance of engaging in every aspect of business in aserious, earnest manner is supported by the strong
sense of mission and pride as a company that takes
responsibility for essential work.
And I hope to see the Company pass this value
system on into the future without wavering.

Shoji Since joining the Board two years ago as anindependent outside director from outside theMitsubishi Group, my impression has been that theCompany is generally conservative, for better orworse, just as Mr. Wakabayashi mentioned. Although
it seems to me that the Company lacks a sense of
speed because it is so careful, you could also say
this means the Company plans and executes
business in a meticulous, precise manner. The
mindset of exactingly storing freight entrusted byshippers and delivering it to the receiving party also
shows up in the Company’s corporate culture and in
its approach to advancing discussions. And I feel thisdisciplined, conscientious stance is a major positive.
Mitsubishi Logistics’ executive departments andadministrations both sincerely acknowledge thequestions posed by the outside directors, and truly
engage with us in a forthright manner, for example byflexibly considering revisions to their approach tooperating the Board through the provision of extra
time so that we can deepen discussions. Yet theBoard of Directors is still held in person andessentially relies on paper documents, which is why I
feel one of the challenges is the room there is forbetter utilizing IT, for example, to streamline
operations.

Operations and Effectiveness of the Board of Directors
Wakabayashi In 2021, the Board began holding
more lively discussions with the additions of Mr.
Shoji, who has spent many years working in the fieldof IT, and Ms. Kimura as a female director withknowledge in the field of health care. Because
Mitsubishi Logistics operates as a company with a
Board of Corporate Auditors, the Board of Directors
serves as a managing board, whereby the process ofmaking decisions following extensive discussion of
agenda items functions sufficiently. In order tocontinue doing so, the outside directors must have abetter understanding of the business, though. The
Company therefore provides us with briefings to
explain each business along with opportunities totour the warehouses and other worksites, which I
also feel is helpful in enhancing the effectiveness of
the Board of Directors.

Although the operations of the Board of Directors
have improved steadily, at the same time I still feel weshould be better informed regarding the process theexecutive side uses to summarize its opinions prior
to discussion by the Board of Directors, as well as
the details of those discussions, depending on thematter at hand. As overseas expansion and othercentral initiatives accelerate, we should also
understand the desires and key points of theexecutive side as part of their discussion process,which I think would allow us to present moreaccurate opinions and views.
Shoji I think the Board of Directors also has apositive approach to conducting its proceedings. In
addition to encouraging opinions and questions, theBoard always confirms whether deliberations andinformation required to make final decisions are

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55

Value-Creation Infrastructure

sufficient. Despite my limited knowledge regarding
the warehousing industry, I ask different questions inpart because I am highly curious. Yet the chairperson
does more than just prompt explanations from theresponsible officer. Instead, in some cases he will
also provide his own explanations as president (infiscal 2022 the president served as chair of the Boardof Directors), while other directors with experience
involved in the related duties sometimes offer
additional explanations including their own specificexperiences, which is highly informative. These
considerations are one of the reasons I feel that thebackground behind the decisions finalized by the
executive side is clearly presented.
If I were to make one request, though, like Mr.
Wakabayashi, I would ask that, when necessary, theCompany better clarify the process and discussions
from the stage prior to presentation at the Board of
Directors, but not necessarily in every case. For
example, we should know why the Company chosea specific plan from the different options. As outside
directors, we possess a different set of informationfrom the executive side, so such explanations would
also serve to bridge this disparity in knowledge. And
there are also agenda items where I feel the
Company should make a greater effort to draw out aslightly broader range of opinions from the auditors.
Moreover, I think that younger business executives
should make presentations to the Board of Directors,
for example, which would also serve as a good
opportunity for them to grow.

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Wakabayashi As members of the Monitoring
Board, the Directors do not supervise every tiny
movement by the executive side, but instead
primarily monitor decision-making-based results. For
example, I will look to better confirm the big picture,including an analysis of factors why budgets are or
are not achieved as well as budget results, how tomanage these factors, and time limits.
As a member of the current Managing Board
structure, as well, I hope to strengthen theseovertones.
The quality and volume of materials used by the
Board of Directors is fitting, and we are also provided
enough time to receive detailed explanations of theimportant discussion items prior to meetings.
Similarly, the volume of proceedings per meeting is
also appropriate.
Shoji Although this is the most basic stance as an
outside director, from the standpoint of questioning if
something might appear unusual within the scope ofcommon sense, I make every effort to ask simple
questions about anything that seems problematicwhen seen in general. Which is why I want theCompany to pay a little more attention to thematerials. Specifically, I would prefer if the materials
contained graphs and charts instead of relying on
text, and be structured in a way that wasunderstandable at a glance. This would allow thematerials to convey to those from outside theCompany with limited time all of the information used
for making decisions. You can think of us like a kindof sensor. For example, when we must judge therisks involved in a business, it is difficult for us to doso based on a sentence that states the business is“Safe.” Instead, the materials should illustrate thesafety of the business using graphs and tables, forexample, in a way that analyzes and clearly indicatesthe extent of risk, and shows how problems can be
minimized using a certain approach to risk hedging. I
think this approach would make it easier for us topass judgement, and allow us to function moreaccurately as a sensor.

Expectations for Mr. Saito as the New President
Wakabayashi I would first ask Mr. Saito to steadily
advance the MLC2030 Vision, and to ensure that it
moves forward with a sense of speed.
Having served as the chair of the Nomination andCompensation Committee since 2020, I had theopportunity to interview Mr. Saito when he became
managing executive officer and again when the
Company appointed him as president. At the time, it
seemed to me that Mr. Saito felt the need to takeaction in response to major changes in society
through an approach that differed from existing
concepts within the warehousing business, and that
he was working to advance reforms with a sense of
speed, all while valuing initiatives that were already inplace and maintaining the Company’s approach toreliably advancing every aspect of business as one ofits strengths.
One of the things that impressed me was theextent of his professionalism. I think it is rare to find apresident who possesses highly specialized
qualifications as a Labor and Social Security Attorney,
Small and Medium Sized Enterprise Consultant, andIndustrial Counselor. I understand he acquired hisLabor and Social Security Attorney certification inorder to become a professional for businesspurposes when he was a young member of the
Human Resources Department.
Shoji When Mr. Saito delivered a message to
stakeholders upon his appointment as president, I
was extremely honored that he also shared themessage with us ahead of time and asked for our
opinions. After reading his message, I fully sensed his
intention to change Mitsubishi Logistics by exercisingleadership as the new president, spurring on rolling
efforts toward achieving MLC2030 Vision, and driving
reforms. And I welcomed this positive start to hisvoyage.

Initiatives for Human Capital Management
Wakabayashi Two of the Company’s extremely
constructive initiatives that I intend to fully support
are its formulation of a human resource portfolio andthe engagement surveys that it conducts. Human
capital management necessarily involves an ideal
human capital structure as a matter of course, butwhether this structure functions properly comes
down to the relationships of trust between employees
and managers. And this is an area in which
engagement is also involved. In response to thedesire of employees to learn, for example, theCompany must actively create opportunities for themto learn, and not simply offer top-down training. The
basis of human capital management is therelationships of trust that form between employees
and their managers and the Company, and it iscommunication that fosters these relationships. The
Company must therefore ascertain whether one-onone meetings are enough, as well as make changes
to the IT infrastructure in a way that allows employees

to view the news they want to read at any time over
the Company-wide portal site.
Shoji Human capital management has become akind of buzzword for society, so I hope that Mr. Saito,
who acquired national certifications and studied to
become a human resources professional, creates theright environment, considers system improvements,
and carefully fosters human resources because I
want him to fully address the motives that drive each
employee to aspire to professionalism. Although
Mitsubishi Logistics relies in part on a humanresources arrangement that is supported bytraditional career-long employment, the coming
generation will likely have a weaker sense of joining acompany. As an outside director, Ms. Kimura often
questions why Mitsubishi Logistics does not promoteitself despite being so attractive. Similarly, I think theCompany should recruit young employees bycommunicating the ability to experience engaging
work, gain skills, and grow at Mitsubishi Logistics.

Mitsubishi Logistics Integrated Report 2023

57

Value-Creation Infrastructure

Moreover, the Company must also present working
styles that allow for the well-being and happiness of
those who join the Company. Doing so will also likely
connect to a higher engagement score. As far as
recruiting women is concerned, in addition toexerting every effort to establish environments thatmake it easier for women to work, although theymight be a bit off in the future, the Company must
convey that it will fully train female role models, andcreate environments that are attractive to women.
And in this respect, I expect much from Mr. Saito’s
leadership with his many years of experience inhuman resources.
Wakabayashi Given its involvement in essential
work, the Company must secure people in order tocontinue its business, even during pandemics. To theextent to which the Company must provide a buffer
for its human and other forms of capital, I believe it
should take a different approach to its cost of capitalfrom industries in which work can be pursued entirely
from remote locations. I hope that Mr. Saito will
theoretically research this aspect through industry,
government, and academic collaboration, andanticipate that his efforts will bring this approach tothe cost of capital to light.
I also believe the warehousing business isfundamentally the same as asset management
services as part of the trust business, where service
providers are entrusted with and manage the assetsof consignors. In other words, the warehousingbusiness does not simply provide space in awarehouse to store the goods of the shipper. Instead,its value is only appreciated when it stores andmanages the entrusted goods exactly as the shipper
expects, that is to say, this business is essentially oneof living up to the trust of shippers. Mitsubishi
Logistics must therefore remain this kind of trusted
presence for shippers, where both a fair amount oftime and money are involved in building and securing
trust among its customers.
I also hope to see Mr. Saito pursue approaches
from the stance of industries like those I mentioned
earlier, regarding the form that the cost of capitalshould take for services that undertake essential
work on the basis of trust among customers.
Shoji There is a tendency to forget that thoseengaged in the logistics business are also essential
workers. Mitsubishi Logistics was involved in storage
and shipping services for foods, beverages, andpharmaceuticals during the pandemic, and helped
maintain the supply chain, despite the state of
emergency declarations issued in response to the
spread of COVID-19 and the restrictions they placedon the movement of people and goods.
The warehousing business includes many aspects
that could be promoted as an employer of essential
workers in the event of large-scale disasters, not justpandemics like COVID-19, yet I feel the Company
should advertise these more skillfully.

Medium- to Long-Term Expectations for Mitsubishi Logistics
Wakabayashi The other day I had the opportunity
to tour the Misato No. 1 Office in Saitama, where the
SharE Center misato distribution center for
e-commerce was opened in July 2021. Although I
expected to see forklifts driving around as is the casein any other warehouse, instead what drew myattention was the employees who wore white labcoats in areas that looked like clean rooms as they
worked to apportion pharmaceuticals. So, I was
impressed that the Company had also begun
handling the final steps previously handled bypharmaceutical companies.
Along with rediscovering the upsurge inoutsourcing demand for logistics, this experience
also allowed me to once again realize the potential
for the Company to see expanding business
opportunities. In order to break through preconceived
notions, however, the Company must think in acompletely new way. One such conceptual example
might be to take an approach whereby the Company

58

Mitsubishi Logistics Integrated Report 2023

handles logistics for customers in a way that enables
them to allocate resources to more important areas.
Shoji There are potential needs in both early stagesof the logistics process, such as distribution
processing in warehouses, and later stages before
loading onto trucks. My tour of the Misato Center
helped me understand the potential for incorporating
business opportunities by spreading the wings of the
distribution process beyond storage. Although it isn’t
a warehouse, being a similar type of facility, I feel thatYokohama Bay Quarter is also really amazing. In part
because it helps increase value as a piece of realestate, it appears to me that Mitsubishi Logistics also
holds the ability to raise value. In short, the Company
possesses flexibility specifically because it owns
warehouses, and I want it to better exercise thispotential.
Wakabayashi The other day I received a briefing
on the Company’s launch of a corporate venture
capital fund as part of a progress report on themanagement plan. Although I felt it was an extremelyinteresting initiative, I want the Company to maintaina constant, precise awareness regarding the purposeof such initiatives. DX is a similar situation, where DX
in and of itself is not the goal, but should instead be
positioned as one of the ideal paths.
In the case of venture capital, individual initiatives
are not always successful, and sometimes land far
from the mark. Which is why the Company mustswiftly recognize when an initiative has missed themark and cut any losses as soon as possible, allwithout being afraid of failure itself. The key toaccelerating decisions regarding when to move
forward with or withdraw from a venture, such as tobe more aggressive, pause, or accept the potential
for business risk, is to maintain a constant, clear
awareness of the ultimate goal.
Shoji I feel exactly the same. Although returns are
greater when a DX project proceeds smoothly, thecosts also increase. Whereas in fact there are many
DX initiatives that are non-starters. Despite the needto withdraw as early as possible if an initiative is a
non-starter, Japanese people have a tendency
toward inertia, where the default is to continue on
regardless. Yet initiatives must be reconsidered
immediately if they are judged to be struggling or
ineffective. And one must have the courage to quitwith a sense of speed. In particular, I feel it iscommon for the Company to promote DX initiatives

and develop new businesses together with outside
parties, but this also tends to cause inconsistencies,
so the Company must share its awareness withpartners, confirm the direction of its efforts, andproceed while aligning them.
Wakabayashi The Board of Directors is also
evolving in a positive direction, and I will continue toprovide support for this into the future wheneverpossible. I have also persisted in commenting on the
Company’s approach to cross-shareholdings, in
response to which it has presented its plans for
reducing them in the form of a roadmap. I also intend
to continue expressing my thoughts on whether tostep on the gas or the brakes regarding topics thatmight be difficult to accept at times, including theCompany’s approach to ESG, based on an objective
understanding of trends in society. From agovernance format perspective, I am also looking
forward to how today’s standing as a company witha Board of Corporate Auditors will evolve into the
future in response to changes in society. Meanwhile,in terms of human capital, I hope the Company also
considers holding conversations with the next
generation of employees who are not at the
managing executive officer or executive officer levelyet. I feel this way because these types of initiatives
will allow younger employees to become more deeply
knowledgeable about Mitsubishi Logistics.

Mitsubishi Logistics Integrated Report 2023

59

Value-Creation Infrastructure

Organizational Governance (Corporate Governance)
With regard to our organizational governance, we will explain our
stance on the corporate governance system, the Board of Directors,
our approach to the election of officers, etc., and risk management,
as well as initiatives for maintaining and strengthening the compliancesystem, and communication with stakeholders. You may also refer tothe introduction of officers and skill matrix.

Corporate Governance
Basic stanceJune 29, 2022, we eliminated directors with special titles
other than the Chairman of the Board, positioned thepresident as an executive officer, and changed the system
to one in which executive officers are responsible forbusiness execution.
Furthermore, we are endeavoring to boost corporate
governance through multiple initiatives, such as:
establishing an internal control system through drafting therules of conduct for our executives and employees, setting
up the Internal Control and Compliance Committee, andenhancing an internal audit system (from April 2022, theInternal Audit Department is under the direct control of thepresident); instituting a risk management system via the
Risk Management Committee and “Initiatives for ESG
Management and the SDGs” through the establishment of
the Sustainability Committee; and, finally, by reinforcing
disclosure through the early publication of financial
statements. (See the chart of corporate governancesystem below）

The Company recognizes the enhancement of corporate
governance as a significant business issue that will enable
us to carry out our social mission and responsibilities as apublicly listed company and to aim for sustainable growthand development. Accordingly, we are working to enhance
the functions of the Board of Directors and Board of
Corporate Auditors by appointing outside directors andoutside corporate auditors. We established a Nomination
and Compensation Committee as an advisory body to theBoard of Directors to further enhance the objectivity andtransparency of the procedures for determining thenomination and compensation of directors. In addition, we
have introduced an executive officer system for the
purpose of further strengthening corporate governance bystrengthening management and supervisory functions,and by improving management efficiency and accelerating
decision making. Moreover, in order to further promote theseparation of management and business execution, as of■ Chart of corporate governance system (as of the end of August 2023)

General Shareholders Meeting
Board of Directors

Corporate Auditors

Nomination and Compensation Committee

Board of Corporate Auditors

Corporate Auditors’ Chamber

Executive Committee

ChairmanPresident
Senior Managing Executive Officer
Managing Executive Officers

General Managers’ Meeting

Respective Divisions,and Chambers of the Head Office (General Managers)

Internal Control and Compliance Committee
Risk Management Committee

Senior Executive Officer, and Executive Officers
6 branches (General Managers)

Group Management Meeting

Independent Auditor

Sustainability Committee

Internal Audit Department

54 subsidiaries (including 21 overseas subsidiaries)
16 affiliates

Revision ofcompensation system

Strengthening the management
and supervisory functions■ Initiatives to date for strengthening governance60

June 2010

April 2020

January 2021

Made the Chairman of the Board a director
without authority of representation

Established the discretionary Nomination
and Compensation Committee

Began conducting survey to evaluate
effectiveness of the Board of Directors

2010

2019

June 2021

June 2022• Increased the number of outside directors by two
Both were selected from outside theMitsubishi group (including one female
director) The ratio of outside directors roseto over one-third of the total• Introduced the executive officer system• Reduced the number of directors
from 18 to 14• Positioned the President as an
executive officer and eliminateddirectors with special titles other thanthe Chairman of the Board

2020

2021

2022

2023

June 2019

June 2020

February 2023

Stopped paying bonuses to outside directors after
FY2018 (only monthly compensation thereafter)

Introduced restricted stockcompensation program

Adopted CO2 emissions reduction rate as a performanceindicator for bonus payment (from payment starting June 2023)

Mitsubishi Logistics Integrated Report 2023

■ Number of directors■ Number of independent outside directors■ Men(persons)■ Women

20
15

15

0

14

0

13

1

13

1

12

10

1

0

■ Women

2020

2021

2022

2023 (Fiscal year)

(%)
50

8

40

6

5
4

0

3

5
1

30

5
1

1

0

38.5

38.5

2021

2022

41.7

26.7
21.4

20

0

2
2019

■ Ratio of independent outside directors

10

4
5

■ Men

(persons)

10
2019

2020

Officer election process
1. Management Executives and Directors
The Company has a total of not more than 14 directors incharge of business execution and independent outside
directors (12 as of the end of August 2023) who comprise
the Board of Directors to enable the Board of Directors toengage in sufficient deliberations based on diverse
opinions and to make swift and rational decisions.
Directors are required to be persons of outstanding
character and broad insight who can be expected tocontribute to the establishment and execution ofmanagement strategy based on the businessenvironment and management issues. Candidates for
management executives and other directors in charge ofbusiness execution possess a wealth of professional
knowledge and experience in business operations, andcandidates for outside directors possess a wealth ofexperience and knowledge in their professional fields andhave the qualities to effectively provide advice andsupervision from an independent and objective
standpoint.
In determining the reappointment or new appointmentof management executives and directors, the Nomination
and Compensation Committee objectively verifies whether
management executives and executive directors havebeen appropriately considered in light of the above
selection criteria, and report their opinions to the Board of
Directors. For candidates for outside directors, theNomination and Compensation Committee evaluates theeffectiveness of each candidate for reappointment or new
appointment based on the above selection criteria, andreports their opinions to the Board of Directors. In
particular, with regard to the new appointment of outside
directors, the Company considers the necessary qualities,
etc. at the time of each appointment, compiles a list of
candidates, and updates this list each year from theperspective of ensuring the appropriate composition of
the Board of Directors required for the sustainable growthof the Company. When it becomes necessary to appointa new outside director, the Nomination andCompensation Committee interviews candidates selectedfrom a list of candidates based on the above policy, thecomposition of the Board of Directors, and the suitabilityof persons as outside directors, after which it selects
candidates and makes a report to the Board of Directors.

2021

2022

2023 (Fiscal year)

0

2019

2020

2023 (Fiscal year)

The Board of Directors discusses these reports atmeetings of the Board of Directors attended also byoutside directors and outside corporate auditors,
appoints management executives by resolution of theBoard of Directors, and determines candidates for
directors.
In the event that a management executive commits an
act in violation of public order or morals, faces difficulties
in continuing to execute his or her duties for healthreasons, or significantly harms corporate value due to theneglect of his or her duties, the Board of Directors shallconsider submitting a proposal regarding the dismissal of
said management executive to a meeting of the Board of
Directors held with the attendance of outside directors
and outside corporate auditors as necessary, and shall,prior to submitting the proposal, consult with theNomination and Compensation Committee and explain
the reasons for the dismissal to outside directors andoutside corporate auditors other than members of theCommittee.
2. Corporate Auditors
The Company’s Board of Corporate Auditors consist of a
total of five corporate auditors, consisting of two internal
corporate auditors and three independent outside
corporate auditors, in order to enhance audits andincrease the independence of the corporate auditor
system from management.
Corporate auditors are required to be persons ofoutstanding character and broad insight. Candidates forinternal corporate auditors are familiar with the actual
management of the Company, and candidates for outside
corporate auditors have a wealth of professional
knowledge and experience in their professional fields,
including their industry, legal affairs, and accounting.
Based on this policy, Representative Directors preparea draft list of candidates for corporate auditors andproposes it to the Board of Directors with the consent of
the Board of Corporate Auditors. This is deliberated on bya meeting of the Board of Directors held with theattendance of outside directors and outside corporate
auditors, and the candidates for corporate auditors are
determined by resolution of the Board of Directors.

Mitsubishi Logistics Integrated Report 2023

61

Value-Creation Infrastructure■ Expertise and experience of each director (skill matrix)

Name

Board
Current position at meeting
the Company
attendance
ratio

Expertise and experience
Corporate
management

Finance andauditing

Marketing

ESG andsustainability

HR strategy

Legal affairs,
compliance, andrisk management

Technology

Contribution to
the Company’s
growth*Masao Fujikura Chairman

100%

●

●

●

●

●

●

Overall

Representative Director
Hidechika Saito and President
Director and Senior
Hitoshi Wakabayashi Managing Executive Officer

100%

●

●

●

●

●

●

Overall

100%

●

●

Director and Managing
Shinji Kimura Executive Officer
Director and Managing
Munenori Kimura Executive Officer

100%

●

●

100%

●

●

Director and Managing
Executive Officer

100%

●

Representative Director andMasanori Maekawa Managing Executive Officer

100%

●

Tatsuo Wakabayashi Outside Director

100%

●

Toshifumi Kitazawa Outside Director

100%

Tadaaki Naito

Outside Director

Tetsuya Shoji

Akira Yamao

1, 2, 4
●

3

●

2

●

●

4

●

●

●

5

●

●

●

●

5

●

●

●

●

●

5

91.7%

●

●

●

●

●

5

Outside Director

91.7%

●

●

●

●

●

4

Kazuko Kimura Outside Director

100%

●

●

●

●

1

*C
 ontribution to the Company’s growth: contribution to the growth strategy for accomplishing the MLC2030 Vision (the wording below is basically taken from the MLC2030 Vision)
1. Establish a customer-oriented support system (taking on challenges of entire supply chains focusing on the medical/healthcare, food/beverage, machinery/electricalmachine, and new materials industries)
2. Expand overseas business3. Secure stable profits in the Port and Harbor Transportation Business and the Real Estate Business4. Improve operational processes and promote further utilization of new technologies
5. Strengthen the Group management baseNote: The table above does not represent all the skills the individual directors possess.

62

Evaluation of the effectiveness of the Board of Directors

Nomination and Compensation Committee

In order to further improve the effectiveness of the Boardof Directors, every year, the Company conducts a selfassessment questionnaire consisting of questions andfree comment sections for all directors and corporate
auditors regarding the size and composition of the Boardof Directors, the operation of the Board of Directors, therole and functions of the Board of Directors, collaboration
between supervisory functions and auditing organizations,etc., and relationships with shareholders and investors.
As initiatives based on the questionnaire results, in
FY2022, we increased the opportunities and time spent
to explain the Group’s businesses and issues to outside
directors and outside corporate auditors and to provide
them explanations on important projects in advance, andcreated a place for them to engage in focuseddeliberations on the progress of the Company’s
management plan. In this way, we sought to further
improve the effectiveness of the Board of Directors.
The questionnaire results in 2023 showed that the sizeand composition of the Board of Directors, the frequency
of Board meetings, the agenda items, meeting operation,
provision of information, and the procedural objectivity
and transparency secured through the establishment of
the Nomination and Compensation Committee, among
other aspects, were largely appropriate. Therefore, it wasdetermined that the effectiveness of the overall Board of
Directors had been ensured.
Based on the results of the questionnaire, as part of our
future initiatives, we will consider enhancing our materials
to encourage a more in-depth understanding of theGroup’s businesses and issues. At the same time, we willconsider other measures, including the review of criteria
for choosing the Board meeting agenda, to further
enhance deliberations on management and growthstrategies, among other matters.

The Nomination and Compensation Committee
deliberates on matters concerning the recommendationof director candidates about whom the Board of Directors
has inquired, as well as the selection and dismissal of
representative directors, directors with special titles, andexecutive officers with special titles. It also deliberates on
the composition of the Board of Directors, the adequacy
and upper limit of the level and composition ofcompensation for directors and executive officers withspecial titles, the compensation system for directors andexecutive officers with special titles, and other mattersdeemed necessary by the Board of Directors. The resultsof these deliberations are reported to the Board.

Mitsubishi Logistics Integrated Report 2023

Committee
members

Total of five directors including Wakabayashi (outside,
Committee Chairperson), Kitazawa (outside), Shoji(outside), Fujikura (Chairman of the Board), and Saito(Representative Director and President)

Number ofmeetings held
(FY2022)

Four times(approximately 50 minutes each on average)

Number of
agenda items

12 items resolved

Main agenda
items

Personnel matters regarding officers; changes in the
Articles of Incorporation concerning the positions of
directors and executive officers; selection criteria for
executive officers with special titles, policy on
determining individual compensation of directors;
composition ratio of director compensation; distributionof compensation by individual director; etc.

	Matters concerning the determination of the amountand calculation method of officer compensation

purpose within the compensation limit that is common
with basic compensation to directors excluding outside
directors as compensation for granting restricted stock.
The stock cannot be disposed of until the recipient retires
or resigns from the position of the Company’s director orother positions decided by the Company’s Board of
Directors.

The Nomination and Compensation Committee isconsulted on the policy for determining the details ofcompensation for each director. Based on the report
received from the committee, the Board of Directors
makes a resolution as follows.

◆P olicy for determining the ratio of monetary◆ Policy for determining the amount of basic

compensation, performance-based compensation,and nonmonetary compensation for each director
The payment amount per type of compensation for eachdirector shall be determined so that the ratio per type ofcompensation for each director will function as an
appropriate incentive commensurate with the duties
expected for each position.
To link compensation with medium- to long-termbusiness performance, the Company’s shares shall beacquired through the officer stock ownership plan using
contributions from monthly compensation and bonuses atamounts not less than those set for each position. All theshares purchased shall be held throughout the service
period and until one year after retirement.

compensation for each director, details of
performance-based compensation andnonmonetary compensation and calculation methodof their amount or figures (including the policy for
determining the timing and terms of granting thecompensation)
Compensation for directors shall consist of basic
compensation, performance-based compensation, andstock compensation at amounts based on their duties
and the compensation level of society in general.
Basic compensation shall be paid according to theposition of each director as monthly fixed compensation
within the limit of compensation determined at a general
meeting of shareholders.
Performance-based compensation shall be bonuses for
directors excluding outside directors. Payment is to bemade at a specific timing every year at an amountdetermined according to the performance indicators of
the previous fiscal year within the compensation limit thatis common with basic compensation. There are three
performance indicators designated by the Company(changed at the Board of Directors meeting on February
24, 2023): namely, operating income, consideredappropriate as an indicator of the results of corporate
operations; ROE, considered appropriate as an indicatorof capital efficiency; and CO2 emissions reduction rate,
which is an indicator of the Group’s environmental
response within its ESG management and SDGs
initiatives. The compensation amount shall be calculated
based on the previous fiscal year results of theperformance indicators, using a predetermined calculationtable. When doing so, a certain degree of addition or
subtraction is allowed based on assessment of the efforts
made toward the challenges set for individual directors.
Stock compensation is intended to incentivize recipientsto sustainably increase the Company’s corporate value
and promote the further sharing of value withshareholders. Payment is to be made at a specific timing
every year at an amount deemed reasonable in light of the◆ Determination of details of compensation for each director
Based on the above policy, matters such as thecompensation limit to be submitted to the general meetingof shareholders, drafts of proposals regarding stockcompensation, and allotment of each type ofcompensation for each individual shall be discussed by
the Nomination and Compensation Committee. The
Committee was established as an advisory body to theBoard of Directors mainly comprising independent outside
directors to further enhance the objectivity andtransparency of the procedures for determining thenomination and compensation of directors. Based on thesuggestions of the Committee, the Board of Directors
shall discuss and resolve the matter at its meetings
attended by outside directors and outside corporate
auditors.

 olicy for determining the amount of compensationP
for Corporate Auditors and its calculation method
Compensation for Corporate Auditors is determined bydiscussion between Corporate Auditors within thecompensation limit resolved at a General Meeting of
Shareholders.

■ Total amount of compensation for each officer category, total amount of compensation by type, and number of eligible officers

Total amount per type of compensation
Bonuses (performance- Restricted stock compensation
Retirement benefits
Basic compensation
based compensation) (nonmonetary compensation)

Number of
eligible
executives

Category

Total amount ofcompensation

Directors(of which, Outside Directors)¥439 million(¥52 million)¥334 million(¥52 million)¥56 million(—)¥47 million
(—)

—
(—)

15
(5)

Corporate auditors(of which, Outside Corporate Auditors)¥78 million(¥42 million)¥78 million(¥42 million)

—
(—)

—
(—)

—
(—)

5
(3)

*1 The upward limit on total compensation for the directors is ¥600 million per year (of which ¥100 million per year for outside directors and ¥150 million per year for restricted
stock compensation). The upward limit on total compensation for corporate auditors is ¥120 million per year.
*2 Of the bonuses paid in June 2022 (¥51 million) and June 2023 (¥58 million), the amount of bonuses shown above is the amount recorded as expenses in the fiscal year under review.
The actual results of the performance indicators that affect bonuses are shown in the following table (the CO2 emissions reduction rate is an estimate as it takes time to calculate it).
June 2022 payment

June 2023 payment

Performance indicators

219th term (FY2021)

220th term (FY2022)

Consolidated operating income¥18,144 million¥23,027 million

Consolidated ordinary income¥23,151 million

(N/A)

5.4%

Consolidated ROE
CO2 emissions reduction rate

(N/A)

7.8%
-33.2%*3 In addition to the payments shown above, ¥52 million was paid to cover the portion of employee salaries for directors concurrently serving as employees (two persons during
the fiscal year under review).

Mitsubishi Logistics Integrated Report 2023

63

Value-Creation Infrastructure
Introduction of officers
Directors① Chairman② Representative Director andPresident

Masao Fujikura③ Director and Senior
Managing Executive Officer

Hidechika Saito④ Director and Managing
Executive Officer⑤ Director and Managing
Executive Officer

Shinji Kimura

Munenori Kimura

Hitoshi Wakabayashi⑥ Director and Managing
Executive Officer⑦ Representative Director andManaging Executive Officer

Akira Yamao

Masanori Maekawa⑧ Outside Director⑨ Outside Director

Tatsuo Wakabayashi⑪ Outside Director⑩ Outside Director

Toshifumi Kitazawa

Tadaaki Naito⑫ Outside Director

Tetsuya Shoji

Kazuko Kimura⑫

64

Mitsubishi Logistics Integrated Report 2023

⑩

⑦

⑧

⑤

①

③

②

④

⑨

⑥

⑪

Corporate Auditors① Corporate Auditor(full time)② Outside Corporate Auditor(full time)

Yasushi Saito

Masanao Yamato③ Outside Corporate Auditor④ Outside Corporate Auditor

Yohnosuke Yamada Takao Sato

⑤ Corporate Auditor

Junya Miura

⑤

③

①

②

④

Executive Officers
Senior Executive Officer

Executive Officer

Executive Officer

Executive Officer

Akio Miura

Manabu Kusuyama

Naoyuki Inamo

Takashi Mukai

Executive Officer

Executive Officer

Executive Officer

Executive Officer

Shiro Ochi

Misao Kawamura

Eiichi Kato

Chikara Kurimata

Mitsubishi Logistics Integrated Report 2023

65

Value-Creation Infrastructure
Risk Management
Main risks and countermeasures
Risks

66

Risk explanations and countermeasures

Changes in thebusiness
environment

The Logistics Business and the Real Estate Business are both affected by changes in the businessenvironment. But whereas the Logistics Business is affected by both economic fluctuations in Japanand overseas, and logistics rationalization and business restructuring by corporate clients, the Real
Estate Business is affected by, for example, the supply and demand balance and market trends in therental office market.
The Group’s primary businesses are the Logistics Business with the Warehousing and Distribution
Business as its core, and the Real Estate Business, which focuses on the leasing of buildings. The
Group strives for stable growth through planned capital investment and the provision of sophisticatedservices.

Damage tobusiness assets(warehouses, rentalbuildings, etc.)
caused by natural
disasters

In the event of a large-scale natural disaster, such as an earthquake, typhoon, heavy rainfall, flood,tsunami, or volcanic eruption, there is a risk of serious damage that cannot be covered by insurance,
which could affect the financial position and operating results of the Group.
With regard to business assets such as warehouses and rental buildings, in addition to earthquake
resistance and seismic isolation measures for buildings, external insurance coverage, and provision ofreserve for private insurance, we take necessary measures including daily inspections andmaintenance, the compilation and updating of manuals in the event of a crisis such as a natural
disaster, and the holding of regular training.

Reduction inmarket value andprofitability ofbusiness assets(land, buildings,
etc.)

In some cases, the amount of investment cannot be expected to be recovered due to a decline in thefair value of land or buildings, etc., or a decline in profitability as a result of the application of the
Accounting Standard for Impairment of Fixed Assets. To avoid carrying forward losses far into the
future, the Group may apply impairment accounting to reflect the possibility of recovery.
In the fiscal year ended March 31, 2023, we recorded an impairment loss (¥173 million) as an
extraordinary loss on the Group’s warehouse facilities (buildings), etc., which had declined in
profitability.

Fair value
fluctuations ofinvestment
securities

The Group’s investment securities as of the end of the fiscal year under review stood at ¥144,282
million, consisting mainly of shares in its business partners, primarily for the purpose of maintaining andstrengthening business relationships. However, the application of the Accounting Standard for Financial
Instruments means we are affected by fluctuations in market prices, such as share prices.
The Company will recognize an impairment loss on available-for-sale securities with a market price if
their fair value falls by 30% or more compared with the acquisition price, taking into consideration thepossibility of recovery. To provide for losses resulting from a decline in the substantial price of stock,etc. without a market price, allowance is recorded as allowance for investment loss taking into accountthe possibility of recovery if total net assets of the issuing company fall below the book value.

Compliance risk
and human rights
issuesCompliance risks and human rights violation risks cannot be completely eliminated, and in the event ofa situation arising that violates laws and regulations or causes a human rights issue, the resultant
administrative sanctions, such as surcharges, criminal sanctions, requests from business partners, etc.
for compensation for damages, and loss of credibility could affect the financial position and operating
results of the Group.
The Group has formulated the Code of Conduct that stipulates compliance with laws and regulations
and the exclusion of antisocial forces as the social norms for employees in executing their duties. The
Group is working to instill awareness of compliance based on corporate ethics in every employee andensure thorough compliance with laws and regulations and various rules through the employee’s
self-check on the status of compliance with the Code of Conduct, as well as by thoroughly promoting
training on compliance. Furthermore, through the establishment of the Internal Control and Compliance
Committee, the implementation status of internal control functions and the compliance conditions shallbe evaluated in an aim to enhance the internal controls and compliance. In conjunction with this, tofulfill our responsibility to respect human rights, which is a prerequisite for realizing our corporate
philosophy, we have established the Mitsubishi Logistics Group Human Rights Policy and arepromoting respect for human rights initiatives.
In addition, we have established an Internal Reporting Hotline (a helpline) that clearly stipulates theprohibition of unfavorable treatment of reporting persons, and are making efforts to prevent or promptly
discover and correct actions that may infringe upon laws and regulations or that may violate humanrights.

Mitsubishi Logistics Integrated Report 2023

RisksRisk explanations and countermeasures

Country risk inoverseas businessdevelopment

Overseas, the Company has a total of 21 subsidiaries in North America, China and Asia, and Europe(three in North America, 16 in China and Asia, and two in Europe), which are engaged in the logistics
business, including warehousing and international transportation. In overseas business development,
we endeavor to practice management activities in accordance with local laws and regulations andbusiness customs, etc., and in the event that the investee acquires non-current assets such as
warehouse facilities, we will consider the degree of country risk and take out overseas investment
insurance as needed.

Exchange rate
fluctuations

In preparing the Group’s consolidated financial statements, the financial statements of overseas
consolidated subsidiaries are converted into yen. As the Company and some of its consolidated
subsidiaries have foreign currency-denominated receivables and payables, fluctuations in exchange
rates could affect the financial position and operating results of the Group.

Tightening of
regulations onenvironmental
conservation, etc.

Going forward, in the event that the tightening of related laws and regulations and other regulations
necessitates new capital investment, the increase in funds and cost burden could affect the financial
position and operating results of the Group.
Recognizing the importance of environmental issues, in addition to establishing the Environmental
Policy and the Environmental Voluntary Plan, the Group has adopted environmental measures as a key
theme in its Initiatives for ESG Management and the SDGs, and is promoting business activities thattake the global environment into consideration. Specifically, in addition to working on energy-saving
measures for warehouses and real estate rental facilities by constructing Disaster-Resistant and
Eco-Friendly Warehouses and Disaster-Resistant and Eco-Friendly Office Buildings, etc., we areendeavoring to introduce equipment and facilities with a low environmental impact and develop
services that reduce the environmental impact in collaboration with customers and subcontractors.
We shall also disclose climate change-related information recommended in TCFD proposals andimplement mitigation measures against transition risks and physical risks.

Information
security risk

If business activities are suspended or information is leaked due to a computer virus, unauthorizedaccess from an external source including cyberattacks, disaster or other cause, the resultant claims forcompensation for damages by business partners and the loss of credibility could affect the financial
position and operating results of the Group.
Utilizing various information technologies to promote business and improve business efficiency, theGroup handles business partners’ confidential information and customers’ personal information in its
business activities.
In the management of information systems and information networks, we focus on stable operations
and security measures, take necessary steps such as appropriate server management and information
backups, and work to reduce security risks through information security education such as training fortargeted attacks.

Risk from
infectious diseases

Due to a regional outbreak of an emerging or re-emerging infectious disease, including COVID-19, or a
global pandemic, the Logistics Business will experience sluggish cargo movements and the Real
Estate Business will face an increased vacancy rate due to tenants moving out, which could
significantly affect the business activities and business results of the Group. As a Group, we will
endeavor to minimize any effects.

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67

Value-Creation Infrastructure
Initiatives for maintaining and strengthening the compliance system	Confirming the appropriateness ofoperations via internal control
The Board of Directors of the Company resolved the“Basic Policy on the Improvement of an Internal Control
System” to ensure the appropriate execution of duties byexecutives and regular employees and theappropriateness of corporate affairs.
Furthermore, the Company improves the systems
necessary for ensuring the appropriateness of financial
reporting and prepares and submits the Internal Control
Report regarding the evaluation of the effectiveness ofinternal control relating to financial reporting in accordancewith the Financial Instruments and Exchange Act.

	
Disseminating the awareness of compliance
The Group endeavors to instill in every employee
awareness of compliance based on corporate ethics. To
this end, it conducts employee self-check (Code of
Conduct questionnaire) on the status of compliance with
the Code of Conduct, which was formulated as the social
norms for employees in executing their duties, as well as
a compliance awareness survey covering anti-bribery andother anti-corruption policies.
The self-check on the status of compliance not only
targets the Company and domestic Group companies. It
is also extended to overseas Group companies using
English texts.
In addition, we aim to disseminate complianceawareness, including that of anti-bribery and other anticorruption policies, and establish good working
environments by using various training opportunities.

	Confirming business processes via
internal audit
The internal audit of the Company is performed mainly by
the Audit Division in accordance with internal audit
regulations and an internal audit plan. The audit is
supported by branch auditors and audit assistants
positioned at the Head Office and respective branches.
The purpose of the internal audit is to precisely grasp thestatus of corporate affairs and financial position so that it
can be used to prevent fraud or errors, for rationalizationof management, improvement of business operations andraising operating efficiency. Since April 2022, internal
audits have been under the direct control of the President,
and the Audit Division reports the results of audits
regarding the Company and affiliated companies to the
President. The Audit Division also supports follow-up
checks on any issues noted in the audit results, andreports the results to the President.
The Audit Division keeps close contact with thecorporate auditors and provides them with internal audit
information to cooperate with the corporate auditors’audits.

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Mitsubishi Logistics Integrated Report 2023

Holding Internal Control and Compliance
Committee meetings
In September 2006, we established the CSR andCompliance Committee and promoted CSR activities
within the Group. In fiscal 2021, matters relating to CSR
were transferred to the Sustainability Committee, andmatters relating to compliance were transferred to theInternal Control and Compliance Committee, thereby
further strengthening these initiatives.
At the Internal Control and Compliance Committee
meeting held annually, we discuss the content of theInternal Control Report, the compliance improvements
based on self-checks of the Code of Conduct compliancestatus, as well as the trends related to whistleblowing andthe Company’s response and future initiatives.
Branch General Managers who are close to theworkplace also participate in meetings of the Internal
Control and Compliance Committee, which helps
maintain and strengthen the compliance system throughvarious responses.

Internal reporting system
The Group has in place a Whistleblowing andConsultation Mechanism comprising the Corporate Ethics
Help Line (contact: General Affairs Division, Personnel
Division, Overseas Business Planning & Coordination
Division, etc.) to ensure early detection and correction ofviolations or potential violations of laws, regulations, andcorporate rules. Additionally, in FY2022, an external
helpline (provided by a service company) was establishedto provide an environment where employees feel at easeseeking consultation. Both helplines handle cases against
bribery and other corruption, ensuring confidentiality andanonymity.
To raise the recognition level and encourage use of theinternal reporting system, we utilized the Code of
Conduct survey taken in December 2022 to check
whether all the Group officers and employees werefamiliar with the system and whether they were keen touse it. We received an affirmative opinion from almost all
respondents and have confirmed our progress in theeffort to spread the system.
In FY2022, the corporate ethics helpline received andhandled 24 whistleblowing cases. Although not all cases
require corrective action, we are committed to taking
appropriate measures that lead to correction.

Initiatives for improving compliance awarenessCSR & Compliance Handbook
The Group published the CSR & Compliance Handbook
in January 2011. Thereafter, in light of subsequentchanges in the business environment, we published arevised edition in May 2022, centered on an online
version. Together with the printed version, the handbook
was made available to all executives and employees
within the Company and domestic Group companies fortheir reference at any time.
We have included our anti-bribery and other anticorruption policies in both the online and printed versionsof the handbook to make them available for viewing by all
employees. In this way, we seek to spread thoroughawareness of these policies.
Additionally, we check the employee awareness level of
our anti-corruption policies through the Code of Conduct
survey administered to all Group employees.
1. We shall comply with laws, ordinances and rules that enable us to honestly and fairly
carry out business activities without deviating from social norms.
(Examples of specific considerations)(1) We shall continuously update traditional internal and external business practices from the standpoint oflegal compliance, while striving to obtain an understanding of the relevant laws and regulations, including
the Warehousing Business Act, the Port Transport Business Act and the Labor Standards Act of Japan.
(2) We shall enforce compliance with Company rules such as the Rules on Preventing Internal Trading,
Accounting Rules, and Implementation Guidelines for Warehousing and Storage Operations.
(3) We shall not engage in any discriminatory practices against subcontractors or peer companies, orparticipate in any form of collusion whatsoever among companies or industry groups. We shall exercise
our own judgment when responding to any administrative guidance of the supervising authorities.
(4) We shall keep gifts and business entertainment to the absolute minimum necessary in light of generally
accepted social standards.
In cases where we are considered to be a related party with a vested interest pursuant to the National
Public Service Ethics Code, we shall not present gifts to civil servants or deemed civil servants, regardlessof whether these items are considered to be condolence gifts, farewell gifts or the like.
Furthermore, we shall not present foreign civil servants with gifts for the purpose of obtaining
illegitimate profits, etc.
(5) We shall step up efforts to tighten information security management in step with advances in digitaltechnologies, while prohibiting the personal use of communication methods via PCs, mobile phones andother devices.
(6) We shall endeavor to properly manage and safeguard personal information and customer information.
(7) If Company personnel discover any evidence of a breach of corporate ethics and believe that the
information may not be duly reported to top management via their direct supervisors, they should report
this information to the Corporate Ethics Help Line (Whistleblower and Consultation Mechanism/reports
may be submitted anonymously). The mechanism shall report this information to top management while
strictly protecting the confidentiality of the informant.
We shall not subject the informant to any disadvantageous treatment on account of his or her reportingand other related reasons.

Compliance Awareness Survey
We provide Web-based surveys on awareness targeting
the Company and domestic Group companies based on
the CSR & Compliance Handbook and the Integrated
Report to improve awareness of CSR compliance.
By asking questions about familiar issues, every
employee thinks about what to do and comes up with ananswer, which leads to the development of complianceawareness.

Review session and training on compliance with the
Subcontract Act and the prevention of insider trading
In March 2023, we conducted a review session on the
Act against Delay in Payment of Subcontract Proceeds,
etc. to Subcontractors (the Subcontract Act) for
employees of the Company and the domestic Group
companies. The session was attended by a total of 2,211
employees who handled tasks associated with the Act ateach business division, and the participants studied theAct’s purpose, scope of application, obligations,prohibited matters, etc., based on questions provided
online. In November 2022 and February 2023, newly
appointed managers, new hires, and mid-level employees
who have been with the Company for about 10 years(109 employees in total) received training on insider
trading prevention. Their level of understanding was also
checked using an e-learning program.

Excerpts from the Compliance Handbook

Initiatives for communication with stakeholders
Information disclosures
The Group provides the stakeholders with information
requiring disclosure or reporting, such as information on
business activities and social contribution activities, in atimely manner through news releases and postings on the
Company website.
Detailed information on our management plan andpolicy, stock information, IR calendar, financial data, IR
materials (flash report, securities report, annual report inEnglish, business report, and financial resultspresentation), etc., is available on the Company website
under “IR information.”
Information is also disclosed on our English website.

	Dialogue between shareholders/investors,
analysts and top management● Easy-to-understand shareholders’ meetings
When we hold a shareholders’ meeting, we strive toprovide easy-to-understand information for theconvenience of attending shareholders by using video
business reports with narration. A video of the General
Meeting of Shareholders was made available for viewing
on the Company website for approximately three months
following the event.

● Results briefing

The Company holds results briefings twice a year (Mayand November) for investors and analysts. In addition to
the explanation of the settled accounting results, the top
management of the Company explains management
policies and the progress of management plans,conducts Q&A and transmits a variety of management
information. We are active in encouraging dialogue withmarket players not only through transmission of theinformation desired by investors and analysts but also by
integrating the feedback of useful views therefrom in its
actual business judgment.
● Dialogue with institutional investors
In order to contribute to the sustainable growth of theCompany and the medium- to long-term improvement ofour corporate value, we continuously hold dialogue
between institutional investors and the management
team. The main topics are capital policies, governance,and sustainability, and opinions and concerns that are
identified through the dialogue are appropriately reported
to the Company as feedback.
You may view the materials for the results briefings
on the IR Information page of the Company website.
HOME ▶ IR Information ▶ IR materials ▶ Presentation

Mitsubishi Logistics Integrated Report 2023

69

Social contribution activities

Contribution to Local Communities
and International Society
Under its corporate philosophy, the Mitsubishi Logistics Group iscontributing to the realization of an affluent and sustainable society. Underthe recognition that the sustainable development of local communities andinternational society will connect to sustainable growth for the Company, we
believe that contributing to the development of local communities andinternational society requires us to not only understand our relationship withthe regions where our business bases are located, but also to understandour relationship with society. Under this belief, we center our activities on
local communities and the environment, and provide support involving
community building, educate future generations, preserve ecosystems, andoffer donations as a means of investment and support that connects to thesustainable development of local communities and international society.

Contribution to Education
Dispatching Lecturers to Kobe University
The Kobe University Faculty of Oceanology has
established an academic field that undertakes the trainingof ship navigators and engineers as the Maritime Officer
License Course (Nautical Sciences & Marine Engineering),
and that debates the relationships between humans andthe oceans, ships, and marine structures.
Since the pandemic, logistics personnel have started to
become recognized as essential workers, which is why
we believe that realizing a sustainable society will rely
heavily on both the further development of logistics itself
as well as the power of future generations who wish to
become involved in logistics. In this light, representatives
from the Kobe Branch have held lectures about
international logistics since fiscal 2021.
This effort has primarily served to convey theattractiveness of the maritime society through an overview
of international logistics, specific operations, key points
that lead to rewarding work, the required knowledge andskills, and other contents that enable attendees to imagine
the types of people who excel in international logistics.
We will continue toconvey the attractivenessof logistics from theperspective of education inan effort to support thetraining of global leadersand experts in maritime
issues as raised by the
Faculty of Oceanology.

Contribution to the Protection of Eco-Systems
Forest Conservation Activities
To address the global environment from the perspective ofprotecting biodiversity, we participated in a reforestation
partnership program led by Kanagawa Prefecture andinitiated related activities in April 2011.
In November 2022, 33 executives and employees
participated in the 10th reforestation activity, which werelaunched after a two-year cancellation to prevent the
spread of COVID-19.
The participants were divided into two groups, where
the tree thinning work group engaged in felling, branchremoval, and log cutting work in the area around Tanzawa
Lake in Kanagawa Prefecture. By thinning the densely

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Mitsubishi Logistics Integrated Report 2023

crowded trees, these efforts promote tree growth andallow light into the dark forest, thereby spurring
undergrowth to thrive and prevent landslides. Under theguidance of instructors, participants engaged in natureobservations to deepen their understanding of theenvironment, namely through walks in the Yadoriki
watershed forest to view the lush nature. In this way, theactivity is also helping to foster an awareness of theenvironmental action raised by the Company.
Through this initiative, participants do more than simply
contribute to society as part of a forest conservation
activity. They also
increase their own
awareness ofprotecting thenatural environment
and are able torefresh their minds
and bodies. The
next event isscheduled for
October 2023.
Participants from the Head Office, Tokyo Branch
and Yokohama BranchParticipation in Seaweed Bed Restoration Activities
In June 2023, employees from the Nagoya Branch
participated as volunteers in support of seaweed bed
restoration activities at Sakushima, Aichi Prefecture, an
event in which our shipping company partners mainly
participate.
Seaweed beds (eelgrass beds) function to purify
seawater, absorb CO2, and maintain marine biodiversity as
safe places to lay eggs and raise offspring, and are
therefore referred to as the cradles of the ocean. This year,
participants collected some of the seaweed from colony
growth and transplanted it to restore areas where
seaweed was in decline.
Participants commented that the activity was fun andmeaningful, and that they want to participate again.
Looking to thisactivity as a model,
each branch willtake the initiative incontributing to local
communities and inengaging inecosystem
conservation
initiatives.
Participants from the Nagoya Branch

Participation in Environmental Beautification Activities
On June 11, Fukuoka City organized and held an event
called LOVE EARTH CLEAN UP. As part of this event,citizens, companies, and the government cooperate inenvironmental beautification activities in which seashores,
rivers, and parks are cleaned together, which also
contributes to achieving the SDGs and to ocean plastic
waste countermeasures. A total of 28 employees from the
Fukuoka Branch and their family members gathered along
the Momochi seashore (Sawara-ku, Fukuoka City), andengaged in seashore cleanup activities, including collecting
ocean plastic waste. The Branch will continue toparticipate in similar cleanup activities in order tocontribute to the community.

Participants from the Fukuoka BranchContribution to Local Communities
Participating in Edible KAYABAEN -Contributing
to Local Communities through Food, Agricultural,
Educational, and Community InitiativesThe Company participated in Edible KAYABAEN uponendorsing its goals. The concept of Edible KAYABAEN isan urban community garden that floats in the sky amid thesurrounding buildings.
We empathized with the desire of Edible KAYABAEN tofoster the strength to survive among children and to build
a local community by once again connecting people withnature, and people with people. Similarly, we also support
the right of children to grow, to receive an education, andto participate through initiatives including building a modelof urban greenery using office building rooftops, educating
future generations using rooftop gardens, and building
local communities centered on children. In this way, we
will contribute to the local community and deepen theunderstanding of the SDGs among our employees.

We hold a monthly market, “iimono ippai marche,”at Yokohama Bay Quarter(monthly from December 2020)

Every year at the Yokohama Bay Quarter (the Company’scommercial real estate facilities in Yokohama), we haveheld a number of events, including charity fairs, runningclub events, and radio calisthenics events during thesummer vacation. However, in 2020, most of these eventswere suspended due to COVID-19. Under thesecircumstances, we were contacted by vendors at the
Yokohama Central Wholesale Market in Kanagawa-ku,
Yokohama, Kanagawa Prefecture, where Yokohama Bay
Quarter is also located, who informed us that theconsumption of commercial vegetables at hotels andrestaurants had become sluggish due to COVID-19. As aresult, since last year we have continued to host an“iimono ippai marche” market where consumers canpurchase special kits of assorted vegetables. The market
is held at the entryway (open space) to Yokohama Bay
Quarter. Customers making an advance booking on thewebsite are assigned to a “contactless market” in which
items can only be redeemed on the day of the market.
The event is held with due consideration for preventing the
spread of COVID-19, and we support local producers byproviding the venue free of charge and by introducing theevents on the website and through social media. In the
future, we will bring further excitement to the region as a
shopping mall close to the community, while giving
consideration to safety and security.

We held Lantern Nightat Yokohama Bay Quarter
While it is difficult to hold an event in which many people
gather together at the same time, we held Lantern Night,
an illumination event that customers could enjoy, while
preventing overcrowding at the venue, from May to
September 2022. Lantern Night, which was inspired by
the lantern festival held in Hội An, the ancient capital of
Vietnam, was held for the first time in summer 2019. It
was a popular event again this year with its colored
lanterns often appearing on SNS accompanied byheartwarming comments such as “it made my heartbrighter,” and “I’m so happy to have seen it again.”Moreover, the event was covered by television programs
and many other forms of media, and received countlessposts under the newly proposed hashtag of “#Photogenic
Quarter,” indicating just how many people enjoyed LanternNight in their own way.
Going forward, we willcontinue to work on
projects that enable ourcustomers to feel joy intheir daily lives while
adjusting to the social
landscape.
Lantern Night
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71

Social contribution activities
Cooperative Activities Between Yokohama
Bay Quarter and Kanagawa University
The Kanagawa University HOP STEP BEER project for
growing hops is an SDGs initiative intended to tackle
environmental issues, such as the emerging heat islandeffect in the Minato Mirai area as it undergoes urban
development. Specifically, the project seeks to create andshare opportunities for agricultural experiences in the city
center using a mobile app, generate excitement throughevents, and establish points of contact between thecampus and local communities. The project was held on a
trial basis in fiscal 2021 at the Minato Mirai Campus.
Since fiscal 2021, employees at Yokohama Dia Building
Management Corporation (the Yokohama Bay Quarter
management company) have participated in this project,while the company has engaged in other cooperative
activities with Kanagawa University, including having its
students from the Arts Club create wall art along the
Yokohama Bay Quarter stairwells once per year since 2015.

We participate in local cleanup activities
Operating bases of the Company and Group companies
nationwide also participated in local cleanup activities
voluntarily.
The head office, for example, conducts cleanup
activities twice a month in parks as part of our Street
Cleaning Day program, with 174 employees participatingin fiscal 2022.
We will contribute to the local communities bycontinuing to participate in these cleaning activities.

Street Cleaning Day at the Head Office

We held the Manabosai in umie event on February 25,
2023, at Kobe Harborland umie. The event used firetruck
coloring books and commemorative photographs forchildren dressed in fireproof suits to help children enjoy
learning about fire prevention, as well as disaster
experiences using VR devices, smoke experiences, andfire extinguisher drills to help adults do the same.
In addition, the event included a live performance by
the Fire Department Marching Band, as well as powerfuldemonstration drills by firefighters who sprayed waterfrom firetrucks and conducted rescues using laddertrucks.

We illuminate the Mosaic Ferris Wheel
We illuminated the Mosaic Ferris Wheel in Kobe
Harborland in theme colors and displayed messages inaccordance with various international days andawareness days to disseminate information to local
citizens. During the past fiscal year, we held displays
more than 10 times for the purpose of raising awareness,
including the color blue for World Refugee Day on June
20, World Water Day on August 1, and World
Humanitarian Day on August 19, the color orange forWorld Alzheimer’s Day on September 21, and a pinkribbon for a breast cancer awareness campaign on
October 1. The Mosaic Ferris Wheel is one nighttime
scenery that represents the Port of Kobe. Going forward,
we will continue to collaborate in disseminatingawareness and other information through theilluminations.

Social contribution activities of Mitsubishi
Logistics Thailand Co., Ltd.
Mitsubishi Logistics Thailand conducts social contribution
activities as part of the program for its company trips.
Held for the first time in three years, in 2022 members
divided up into eight groups, with all 200 employees of
the company participating in artificial fish reef production,
elementary school repairs and relief supply provision, andother projects. Through these activities, employees andtheir families came to understand the importance of social
contribution, strengthened their awareness of theenvironment, and were able to deepen friendships
through exchange with those from other workplaces.

Cleanup activities at Kobe Harborland

Cleanup activities at Fuji Logistics Co., Ltd.

72

Kobe Harborland umie and the Kobe City
Fire Department held Manabosai in umie asa collaborative fire prevention event

Mitsubishi Logistics Integrated Report 2023

Repairing an elementary school

Providing meals at an elementary school

Support for a Public Interest Incorporated Foundation

Mitsubishi Logistics America Corporation
Donation Activities

Support for the activities of The Dia
Foundation for Research on Ageing Societies

Mitsubishi Logistics America conducts donation activities
intended to improve the standing of the Japanesecommunity in the U.S. and to contribute to society.
In October 2022, it donated US$1,200 to the J.C.C
Fund.
The J.C.C. Fund serves the purpose of strengthening
ties between the Japanese business community and the
New York metropolitan area, as well as of contributing tosociety. Since its founding in 1985, it has provided grants
to support organizations that offer creative and effective
solutions to contemporary issues in the areas of local
community enhancement, education and academic
research, and U.S.-Japan relations.
Mitsubishi Logistics America contributed to the Fundbecause it has determined that its donations would help
improve the standing of the Japanese-American
community as well as make social contributions.
Moreover, it donated US$5,000 to Japan Parade 2023,
which was held in May 2023.
Japan Parade is held to express gratitude to New York
City, introduce Japanese culture, and create solidarity
among the Japanese-American community. Mitsubishi
Logistics America contributed to the event because it
believes that its donations also play a part in the social
contributions made to the U.S. by Japanese companies
operating there.
Mitsubishi Logistics America will continue to participate
in these kinds of activities in aims of contributing tosociety.

The Dia Foundation for Research on Ageing Societies is
engaged in activities aimed at contributing to solving
issues faced by ageing societies, in fields such as
insurance, medical care and welfare, through investigation
and research into these issues.
Interest is growing in social participation by the elderly,in the context of a declining birthrate and ageing
population.
The Company is collaborating with The Dia Foundation
for Research on Ageing Societies in the utilization ofdiverse human resources, including the elderly. In this way
we aim to realize an affluent and sustainable society.

Contribution to Solutions for Social Issues
Donations for the 2023 Turkey-Syria Earthquake
We provided ¥1 million in donations through the Japanese
Red Cross Society to those who had been affected by
the earthquake that occurred on February 6 with an
epicenter in southeastern Turkey near the border of Syria,
as well as to support recovery efforts.
Along with expressing our deepest sympathies for all
who have been affected, we hope for the fastest possible
recovery of the affected area.

Donations to the Japanese Foundation for Cancer Research
Since fiscal 2011, we have endorsed the JapaneseFoundation for Cancer Research’s Basic Philosophy ofaiming to improve the well-being of people everywhere byachieving better cancer control, and in fiscal 2022
donated ¥1 million. We will continue to support theFoundation to realize its desire for a future free from thefight with cancer.

■ Social contribution activities (Fiscal 2022)■ Community Investments (Fiscal 2022)

Donation
Recipient

Details

Donation
AmountJapanese Red
Cross Society

2023 Turkey-Syria Earthquake
donations¥1 million

JapaneseFoundation forCancer ResearchDonations for cancer research¥1 million

Kanagawa
Prefecture

Donations for the partnershipprogram of reforestation of ¥0.6 million
Kanagawa Prefecture

Activity Details

Number of Participants

Forest conservation activities

34

Social contribution activities ofMitsubishi Logistics Thailand Co., Ltd.

200

Cleanup activities (Head Office)174* Donation details and amounts are excerpted from the General Affairs Division /Sustainability Promotion Team* Donations other than those for the Turkey-Syria Earthquake are the actual
amounts from fiscal 2022

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73

Financial Summary
Financial Items
Fiscal 2013
(year ended March 31, 2014)

Fiscal 2014
(year ended March 31, 2015)

Fiscal 2015
(year ended March 31, 2016)

Fiscal 2016
(year ended March 31, 2017)

Fiscal 2017
(year ended March 31, 2018)(actual results)(actual results)(actual results)(actual results)(actual results)(million yen)

198,161

204,362

206,831208,718

215,407

Logistics Business(million yen)

162,481

170,402

169,006

167,907

181,277

Real Estate Business(million yen)

37,48435,941

39,87642,89436,025Inter-segment transactions(million yen)

(1,804)(1,981)(2,051)(2,083)(1,895)(million yen)

12,148

11,44911,30912,74812,421

Logistics Business(million yen)

6,816

7,204

5,579

6,661

7,662

Real Estate Business(million yen)

9,702

9,166

10,614

11,71910,181

Corporate expenses

(million yen)

(4,370)(4,921)(4,885)(5,633)(5,422)Non-operating income (loss)

(million yen)

1,965

3,007

2,716

3,308

3,739

Ordinary income(million yen)

14,113

14,456

14,025

16,056

16,160Extraordinary income (loss)

(million yen)

288

395

645

(260)

(790)

Profit before income taxes

(million yen)

14,402

14,851

14,67015,796

15,370

Profit attributable to owners of parent (million yen)

8,520

9,133

9,350

10,665

10,517

EBITDA(Operating Income + Depreciation)  (million yen)Amounts per share of profit attributable(yen)
to owners of parent/Earnings per share

24,66524,83825,13925,67325,168

48.62

52.12

53.37

60.88

120.07 ※1
Interim 7
Term-end 14 ※1

Operating revenue

Operating income

Amounts per share of cash
dividends applicable to the year/
Annual dividend per share(yen)Interim 6
Term-end 6

Interim 6
Term-end 6

Interim 6
Term-end 6

Interim 6
Term-end 8

Dividend payout ratio

(%)

24.7

23.0

22.5

23.0

Total assets

(million yen)

396,238

433,041

413,264

435,354462,031 ※2

Total liabilities

(million yen)

159,596

169,952

155,740

158,484

167,480 ※2

Total net assets

(million yen)

236,641

263,089

257,524

276,870

294,550

Net assets per share(yen)

1,337.56

1,486.99

1,455.06

1,565.27

3,330.71 ※1

Equity ratio

(%)

59.2

60.2

61.7

63.0

63.1 ※2

Return on equity (ROE)

(%)

3.7

3.7

3.6

4.0

3.7

Return on assets (ROA)

(%)

2.2

2.2

2.2

2.5

2.3

Depreciation

(million yen)

12,517

13,38913,83012,925

12,747

Increase in non-current assets(capital investment amount)

(million yen)

23,674

24,462

8,841

27,336

21,582

Cash flows from operating activities

(million yen)

19,701

20,691

17,246

21,46621,481

Cash flows from investing activities

(million yen)

(23,144)(20,562)(7,032)(22,270)(22,219)

Cash flows from financing activities

(million yen)

11,634

1,638(7,927)(7,819)3,419

Cash and cash equivalents
at the end of the year(million yen)

41,23643,27645,65836,921

39,58023.3*1 A reverse stock split was conducted on October 1, 2017 at a ratio of one share for every two shares of common stock.
*2 The Company has applied “Partial Amendments to ‘Accounting Standard for Tax Effect Accounting’” (Accounting Standards Board of Japan Statement No. 28, February 16,2018) beginning from fiscal 2018. The consolidated financial position for fiscal 2017 has been retrospectively adjusted to reflect the application of the Standard, etc.

74

Mitsubishi Logistics Integrated Report 2023

Financial Data
HOME ▶ IR information ▶ Financial Data
Fiscal 2024
(year ending March 31, 2025)

Fiscal 2018
(year ended March 31, 2019)

Fiscal 2019
(year ended March 31, 2020)

Fiscal 2020(year ended March 31, 2021)

Fiscal 2021
(year ended March 31, 2022)

Fiscal 2022
(year ended March 31, 2023)

Fiscal 2023
(year ending March 31, 2024)(actual results)(actual results)(actual results)(actual results)(actual results)(forecast)

227,185

229,057

213,729

257,230

300,594

270,000

260,000

190,434

189,709179,255

215,240

263,899

232,300

215,000

38,67941,19936,153

43,662

38,19939,30046,800(1,928)(1,851)(1,679)(1,672)(1,504)(1,600)(1,800)12,66012,195

11,735

18,14423,02718,00020,000

7,609

7,184

7,232

13,703

18,774

13,50014,00010,783

10,85910,038

10,316

10,123

10,10011,600(5,731)(5,847)(5,535)(5,875)(5,869)(5,600)(5,600)

4,673

4,626

4,278

5,006

7,018

ー

ー

17,333

16,822

16,01323,151

30,04623,200

ー

(541)

(84)

40,097

2,773

10,904ーー

16,792

16,737

56,111

25,92440,951ーー

11,564

11,851

39,16017,892

27,22624,000ー

25,65626,447

26,59533,61038,74233,600ー

132.03137.31462.28219.47342.00313.38ーInterim 15
Term-end 30

Interim 30
Term-end 30

Interim 30
Term-end 30

Interim 39
Term-end 41

Interim 41
Term-end 49

Interim 50
Term-end 50

ー

34.1

43.7

13.0

36.5

26.3

31.9

ー

482,575

468,243535,761

562,187

573,689ーー

183,470

181,886

208,932

214,427

219,256ーー

299,104

286,356

326,829

347,759

354,432ーー

3,381.20

3,298.18

3,914.63

4,238.85

4,489.01

ー

ー

61.4

60.5

60.4

61.2

61.1

ー

ー

3.9

4.1

12.9

5.4

7.8

6.9

7.0

2.4

2.5

7.8

3.3

4.8

ー

ー

12,995

14,252

14,86015,465

15,714ーー

18,036

26,38738,81742,383

16,487ーー

23,352

17,62440,17636,21640,488ーー(31,786)(18,022)(14,002)(29,221)(14,379)ーー

12,066(2,359)(5,270)(16,518)(17,067)ーー

42,97240,541

61,36752,50562,297ーー(Management Plan
(2022-2024) targets)

Mitsubishi Logistics Integrated Report 2023

75

Statement Supporting the UN Global Compact

Statement Supporting the
UN Global Compact
Based on the Code of Conduct, the Group will practice the
UNGC’s 10 principles as a good member of the international
community.

Practice of the UN Global Compact’s 10 principles
The Group agreed to adhere to the
UN Global Compact (hereinafter“UNGC”) and endorsed approval in
May 2014.
The UNGC is a voluntary
corporate responsibility initiative forbusinesses that are aiming forsustainable growth as a responsible
member of society. The UNGC asks companies tovoluntarily participate in creating a global framework totake creative leadership.
At the World Economic Forum in Davos, Switzerland in
1999, Kofi Annan, then Secretary-General of the United
Nations, proposed that companies should observe the 10
principles in the areas of human rights, labor, theenvironment and anti-corruption to solve various
problems that could occur due to internationalization andthe global expansion of businesses. In July 2000, the
UNGC was launched at the UN Headquarters in New
York.
Based on its “Code of Conduct,” the Group will strive
to practice the UNGC’s 10 principles as a good memberof international society.

UNGC’s 10 principles

Human
RightsMitsubishi Logistics Integrated Report 2023

Principle 2: Make sure that they are not complicit inhuman rights abuses.
Principle 3: Businesses should uphold the freedom of
association and the effective recognition of
the right to collective bargaining;Labor

Principle 4: The elimination of all forms of forced andcompulsory labor;
Principle 5: The effective abolition of child labor; andPrinciple 6: The elimination of discrimination in respectof employment and occupation.
Principle 7: Businesses should support a precautionary
approach to environmental challenges;

Environment

Principle 8: Undertake initiatives to promote greater
environmental responsibility; andPrinciple 9: Encourage the development and diffusion ofenvironmentally friendly technologies.

AntiCorruption76

Principle 1: Businesses should support and respect theprotection of internationally proclaimed
human rights; andPrinciple 10: Businesses should work against corruption
in all its forms, including extortion andbribery.

Company Profile and Stock Information■ Company Profile (As of March 31, 2023)
Company name

Mitsubishi Logistics Corporation

Head OfficeNihonbashi Dia Building, 19-1, Nihonbashi 1-chome, Chuo-ku, Tokyo 103-8630, Japan

Establishment

April 15, 1887

Capital¥22,393 million

Number of
employees

4,708 (non-consolidated: 957)

Branches

Tokyo, Yokohama, Nagoya, Osaka, Kobe, Fukuoka

Major Businesses Logistics	Warehousing; trucking; port and harbor transportation; international transportation; marine freighttransportation; customs clearance; development, sales, management and administration of logistics
information systems; etc.
Real Estate	Buying, selling, leasing and management of real estate; contracting of construction work, its design andsupervision; operation of parking lots; etc.
Companies in the Consolidated subsidiaries (50 companies)
scope of
MLC Ventures, Ltd., MLC Innovation First Limited Partnership, Tohoku Ryoso Transportation Co., Ltd., Sairyo Service Co., Ltd., Dia
consolidation
Pharmaceutical Network Co., Ltd., Tokyo Dia Service Co., Ltd., Dia Systems Corporation, Ryoso Transportation Co., Ltd., Unitrans Ltd.,(as of August 31, 2023) Keihin Naigai Forwarding Co., Ltd., Touryo Kigyo Co., Ltd., Fuji Logistics Co., Ltd., Tokyo Juki Transport Co., Ltd., SII Logistics Inc., Fuji

Logistics Support Co., Ltd., Kinko Service Co., Ltd., Chubu Trade Warehousing Co., Ltd., Meiryo Kigyo Co., Ltd., Ryoyo Transportation
Co., Ltd., Kyokuryo Warehouse Co., Ltd., Hanryo Kigyo Co., Ltd., Shinryo Koun Co., Ltd., Naigai Forwarding Co., Ltd., Kyushu Ryoso
Transportation Co., Ltd., Monryo Transport Corporation, Hakuryo Koun Co., Ltd., Seiho Kaiun Kaisha, Ltd., Saryo Service Co., Ltd.,
Mitsubishi Logistics America Corporation, Mitsubishi Warehouse California Corporation, Project Hermes Holding Company, Mitsubishi
Logistics Europe B.V., Fuji Logistics Europe B.V., Mitsubishi Logistics China Co., Ltd., Shanghai Qingke Warehouse Management Co.,
Ltd., Shanghai Linghua Logistics Co., Ltd., Shanghai Linghua Qingsheng Logistics Co., Ltd. Shanghai Lingyun Global Forwarding Co.,
Ltd., Fuji Logistics (China) Co., Ltd., Fuji Logistics (Shanghai) Co., Ltd., Mitsubishi Logistics Hong Kong Ltd., Fuji Logistics (H.K.) Co.,
Ltd., Mitsubishi Logistics Thailand Co., Ltd., P.T. Mitsubishi Logistics Indonesia, P.T. DIA-JAYA FORWARDING INDONESIA, Fuji Logistics
Malaysia SDN.BHD., Dia Buil-Tech Co., Ltd., Yokohama Dia Building Management Corporation, Kobe Dia Maintenance Co., Ltd., T’ACT
Co., Ltd.

Affiliated companies accounted for by the equity method (4 companies)
MY Terminals Holdings, Limited, Kusatsu Soko Co., Ltd., Jupiter Global Limited, In Do Trans Logistics Corporation■ Stock Information (as of March 31, 2023)
Status of stocks
Authorized sharesClassification by types of shareholders
Treasury
Shares
4.6%

Common stock 220,000,000

Number of shares issued Common stock 81,960,739
Number of shareholders

7,764

Individuals
and Others
7.6%

Stock exchange listing Prime Market of the Tokyo Stock Exchange
Securities code

9301

Major shareholders
The Master Trust Bank of Japan, Ltd. (trust account)
Custody Bank of Japan, Ltd. (trust account)
Meiji Yasuda Life Insurance Company
MITSUBISHI ESTATE CO., LTD.
STATE STREET BANK AND TRUST COMPANY 505001
Tokio Marine & Nichido Fire Insurance Co., Ltd.
MUFG Bank, Ltd.
TAKENAKA CORPORATIONNIKON CORPORATIONBNYM AS AGT/CLTS NON TREATY JASDEC

Number of shares Shareholding
held (Thousands)
ratio (%)
14,904
6,631
5,153
3,665
2,606
2,041
1,505
1,505
1,156
1,109

19.1
8.5
6.6
4.7
3.3
2.6
1.9
1.9
1.5
1.4

Notes:
1. In addition to the above, the Company holds 3,780 thousand shares of treasury shares.
2. MUFG BANK, Ltd. has set 375,000 Mitsubishi Logistics’ shares as trust funds for
retirement benefits for which voting rights are reserved, in addition to the shares statedin the table above.
3. The “Shareholding ratio” is calculated after excluding treasury shares (3,780,230 shares).

■ External Evaluation

Foreign
Financial
Corporations,
Institutions
etc.
42.8%
23.1%
Other
Corporationsin Japan
20.0%

Securities
Companies
1.9%

Changes in share price (as of August 31, 2023)
Share price (¥)

Trading volume (million shares)

4,000

20

3,000

15

2,000

10

1,000

5

0

4
5
2022

6

7

8

9

10

11

12

1
2
2023

3

0

■ Web Site

Corporate site
https://www.mitsubishi-logistics.co.jp/english/

Logistics service site (in Japanese only)
https://service.mitsubishi-logistics.co.jp/

Official Youtube Channel
https://www.youtube.com/channel/
UCTVrDsqnzQ_NYQNT6_BIZ4g
Mitsubishi Logistics Integrated Report 2023

77

Sustainability Promotion Team,
Sustainability Promotion Division
Nihonbashi Dia Building
19-1, Nihonbashi 1-chome, Chuo-ku, Tokyo 103-8630, Japan
TEL: +81-3-3278-6451
FAX: +81-3-3278-6694

Extended version
The following are some data related to the Mitsubishi Logistics Integrated Report 2023, which was collected at the end of fiscal 2022.

Environment
Fiscal 2020

Fiscal 2021

Fiscal 2022

Scope of aggregation

Energy use
LP (Liquefied Petroleum) gas(kg)

65,766

61,71059,084

Heated water(MJ)

2,562,699

2,966,207

2,556,847

Petroleum (gasoline)(l)49,996

49,662

48,850

Diesel oil(l)1,309,752

1,424,154

1,440,098

Heavy oil (Heavy oil A)(l)25,681

37,68524,740

Steam

(MJ)

3,355,312

4,435,527

3,470,882

Electricity(kWh)124,483,680

125,697,437

127,749,229

City gas(Sm3)

461,654

487,047

475,006

Cold water(MJ)

44,555,090

45,442,021

48,151,275(GJ)

574,057

586,461594,595

Scope1*1(t-CO2)

4,771

5,136

5,111

Scope2*1(t-CO2)

52,88354,07150,322

Tap water(m3)

436,921424,482

400,477

Rainwater

(m3)

5,266

5,579

50,416

Water withdrawal(m3)

442,187

430,061

450,893

Water discharge(m3)

442,187

430,061

450,893

Waste emissions(tons)

4,453

4,659

5,745

Waste emissions

(m3)

7,195

4,789

6,231

Number of CFCs Calculated Leakages(t-CO2)

719

664

893

Number of facilities that obtained
CASBEE*2 rank A or higher(facilities)

18

18

19

Number of facilities accredited under the Act on Advancementof Integration and Streamlining of Distribution Business(facilities)

11

11

11

DP-Cool service CO2 emission intensity (kg-CO2/(t-m))

1.24

1.00

1.02

Mitsubishi Logistics Corporation,
Fuji Logistics Co., Ltd.,

Total

Ryoso Transportation Co., Ltd.

CO2 emissions
Mitsubishi Logistics Corporation,
Fuji Logistics Co., Ltd.,
Ryoso Transportation Co., Ltd.

Water

Mitsubishi Logistics Corporation

Waste
Mitsubishi Logistics Corporation

Other

Mitsubishi Logistics Corporation

Dia Pharmaceutical Network Co., Ltd.

*1 To reflect the effect of CO2 emission reductions due to the introduction of real renewable energy, the calculation method has been revised from this fiscal year.
*2 Comprehensive Assessment System for Built Environment Efficiency

Mitsubishi Logistics Integrated Report 2023

Extended version

Society
Fiscal 2020
Number of employees

Fiscal 2021

Fiscal 2022

(Men)

(persons)

636

648

623

(Women)(persons)

360

366

334

(Total)(persons)

996

1,014

957

Number of Group employees(Total)(persons)

4,625

4,732

4,708

Number of temporary
Group employee(Total)(persons)

2,570

2,508

2,703

Total of new graduate recruits(Men)(persons)

29

25

19

(Women)(persons)

22

14

12

(Total)*(persons)

51

39

31

(%)

19

15

28

(Men)

(years)

15.1

15.1

15.3

(Women)(years)

16.8

16.9

17.3

(Overall)(years)

15.7

15.7

16.0

(%)

−

2.7

2.6

(persons)

15

16

17

(%)

1.84

2.00

2.05

Monthly average overtime(hours)

13.55

16.45

16.93

Ratio of employees taking
paid leave*5

(%)

51.2

60.0

65.3

(persons)

1

6

13

(Women)*6 (persons)

9

16

10

(Total)(persons)

10

22

23

(%)

5.0

21.4

43.3

(Women)*6

(%)

83.3

123.1

90.9

(Overall)

(%)

34.4

53.7

56.1

(persons)

30

22

17

(persons)

0

1

1(persons)

20

46

35

(persons)

10

14

21

(Men)

(%)

96.6

96.2

89.7

(Women)

(%)

94.4

100.0

95.5

(Overall)

(%)

95.7

97.9

92.2

(Men)

(persons)

16

7

11

(Women)(persons)

5

1

5(Total)(persons)

21

8

16

(%)

97.9

98.5

98.4

(%)

82.1

79.3

81.1

(cases)

−

−

11

−

−

0.896

−

−

0.015

1

Ratio of mid-career recruits toregular employees*2
Average length of service

Ratio of female managers*

3

Number of employeeswith disabilities*4
Ratio of employees with disabilities*4

Number of employees taking
child-care leave(Men)*6

Ratio of employees taking
child-care leave(Men)*

6

Number of employees using
reduced working hours system
Number of employees using
nursing care leave system
Number of employees using
general care leave system
Number of employees using
family care leave system
Ratio of new employees
retained after three years

Number of mid-career recruits

Ratio of employees undergoinghealth checkups
Ratio of employees undergoingstress checks
Number of occupational accidents*
Occupational accident
frequency rate*7, 8
Occupational accident
intensity rate*7, 9

7*1 As of April 1, 2023. *2 According to the definition in the Act on Comprehensive Promotion of Labor Policies. *3 As of March 31, 2023. *4 As of June 1, 2022.
*5 Including contract employees from FY2021. *6 As defined by the Act on Childcare Leave/Caregiver Leave. *7 Mitsubishi Logistics Corporation and its domestic Group companies.
*8 Number of fatalities and injuries due to work-related accidents (with at least one day of absence from work) per million total actual working hours. *9 Number of lost workdays per 1,000 total working hours

Mitsubishi Logistics Integrated Report 2023

Extended version

GovernanceFiscal 2020

Fiscal 2021

Fiscal 2022

Board of Directors(times)

12

12

12

Board of Corporate Auditors(times)

16

16

17

Number of Directors (of which women)(persons)

14 (0)

13 (1)

13 (1)

Number of independent
Outside Directors (of which women)(persons)

3 (0)

5 (1)

5 (1)

(%)

21.4

38.5

38.5

Number of Corporate Auditors(persons)5

5

5

Number of independent Outside Corporate Auditors(persons)

3

3

3

(%)

60.0

60.0

60.0

Fiscal 2020

Fiscal 2021

Fiscal 2022

3,526

3,531

3,512

Fiscal 2020

Fiscal 2021

Fiscal 2022

Ratio of independent Outside Directors

Ratio of independent Outside Corporate Auditors

Information security
Number of respondents to
information security questionnaire*(persons)*Including Group companies

Compliance(cases)

11

14

24

CSR and compliance awareness survey*1(persons)

3,600

3,569

3,574

Number of people who participatedin the Code of Conduct questionnaire*1(persons)

4,404

4,416

4,726

Number of participants in human rights training(persons)

－ *2

43

39

Number of persons who participatedin compliance lecture for prevention of insider trading(persons)

88

58

109

Number of persons who participatedin compliance lecture for the Subcontract Act*1(persons)

2,061

2,151

2,211

Fiscal 2020

Fiscal 2021

Fiscal 2022

Number of reports to the Compliance Reporting Desk*1*1 Including Group companies*2 Not implemented in FY2020 due to the impact of COVID-19

Anti-Corruption Related

Political contributions*
Number of employees disciplined or terminated due toviolations of anti-corruption policies
Fines, penalties, and settlement costs related to corruption

500,000(yen)(persons)

－

－

－

(yen)

－

－

－

* Political fund balance reports (Ministry of Internal Affairs and Communications website)

Mitsubishi Logistics Integrated Report 2023